ACCT 203 Study Guide - Comprehensive Final Exam Guide - Income Statement, Accounting, Retained Earnings
20 Nov 2018
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Document Summary
General purpose financial statements that go to the outside world. (contains fraud liability) Assists managers with 4 general activities: planning, controlling, evaluating, decision making. Underlines all the rules for the external financial accounting realm. Accounting information is supported by: reasonable, reliable, and un- biased evidence. Revenue recognition (sales=revenue) gaap defines a sale by saying: 1. must have a transaction with a customer, 2. there must be a delivery of a good or service, 3. And any account receivable is probable of collection. Accounting equation: assets = liabilities + equity. Anything tangible or intangible that can be owned or controlled to produce value and that is held by a company to produce positive economic value is an asset. Current assets include inventory, while fixed assets include such items as buildings and equipment. Liability an obligation and it is reported on a company"s balance sheet. A common example of a liability is accounts payable.
