MGMT 120A Study Guide - Midterm Guide: Income Statement, Treasury Stock, Deferred Tax
Document Summary
Smoosh method with revenue cycle: dr a/r, dr allowance for write offs, dr or cr cash (plug!) Smoosh method with inventory cycle: dr cogs, dr or cr cash. Principles: revenue recognition: usually recognized at the point of sale, matching: try to match expenses to the same period where revenue is recognized. Litigation- record costs if they are probably and estimable but only record rev when you actually receive it. Market capitalization: market value at a point in time of the shares outstanding. Current assets: used in the longer of 1 year or operating cycle: cash and cash equivalents, short term investments/marketable securities: include ts and afs securities, short term notes receivable, trade/business accounts receivable, merchandise inventory, prepaid expenses. Long term assets: long term investments, pp&e: usually presented as all one item in the balance sheet (land is separated out though) Current liabilities: short term notes payable, trade a/p, current portion of long term debt/bonds, other a/p accounts, unearned/deferred revenue.
