BU127 Chapter Notes - Chapter 1: Accounting Equation, European Cooperation In Science And Technology, Retained Earnings
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BU127 Full Course Notes
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Document Summary
Accounting: analyzes, measures and records financial information about an organization. States the amount of assets (a) liabilities (l) and shareholder"s equity (se) Assets: resources controlled by the entity as a result of post business events. Trade receivables : promises from customers to pay in the future a present deal. Prepayments: payments made now, reflected in future benefits: insurance. Goodwill: intangible: customer loyalty, quality reputation: acquired by buying other businesses. Liabilities: obligations resulting from past business events like purchases of goods and services on credit or borrowed cash. All stated in maturity order (due date) Trade payables: promises to pay present purchases of goods and services from suppliers on credit. Short term borrowings: cash borrowed from banks or creditors that will be repaid in the near future (< 12 months) Notes payable : long term debts with contract. Contributed capital: investments to the company since the beginning of its existence. Retained earnings: reinvested earnings not declared as dividends.
