BU127 Study Guide - Midterm Guide: Bank Reconciliation, Gross Profit, Gross Margin
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BU127 Full Course Notes
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Document Summary
Annual reports for private companies: four basic financial statements, related notes, report of independence of accountants if the statement is audited. Annual reports for public companies: non-financial section, a letter to shareholders, description of managements philosophy, products, financial section, provincial securities commission regulators set minimum disclosure standards for the financial section for public companies. Guiding principles for communicating information: primary objective: to provide economic info to external users for decision making, fundamental qualitative characteristics: relevance; faithful representation, enhancing qualitative characteristics: comparable, verifiable, timely, understandable. Statement of earnings includes: continuing operations, nonrecurring items, earnings per share. Avg # of shares of common shares outstanding. Statement of cash flows sections: operating activities, investing activities, financing activities. Chapter 7: reporting and interpreting sales revenue, receivables and cash. Revenue principle requires that revenues be recorded when earned. Gross profit/margin on sales = net sales - cost of sales.
