Business Administration 2257 Chapter Notes - Chapter 1: Accounts Receivable, Retained Earnings, Accounts Payable
12 Dec 2015
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Proprietorship: unlimited liability, limited life, hard to raise money. Corporation: limited liability, unlimited life, easy to raise money. Asset: a good or service owned by the company which can be used to generate revenue (cash) Liability: a loan to a lender or creditor that is payable by the company. (banker"s note) Shareholders" equity: the amount the company financed through shares. (common stocks) Expenses: economic value used to create revenue (production costs) Fiscal year end: the end of a company"s accounting time period. Usually to match time periods where the business activities are the lowest. The statement of financial position states at the moment what are the company"s assets, liabilities and equities. Current assets: assets that can be converted to cash quickly/used within 1 fiscal year. (inventory) Non-current assets: assets that are not liquid. (building) Current liabilities: debts and obligations that is due within 1 fiscal year. (ap)
