ADMS 3585 Chapter Notes - Chapter 4: Cash Flow Statement, Comprehensive Income, Net Income

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Performance: business model & industries, 3 activities, financing obtaining cash funding by borrowing, shares, profits, also involves repayment of debt/repurchase of shares. Illustration 4-1 pg 151 overview of business model: different business = different models. Items that cannot be measured reliably are not reported in income statement: some critical items are exempted, such as contingent gain cuz not sue if it"ll (cid:271)e (cid:396)ealized. Income numbers are affected by accounting methods that are used: method of depreciation may show initial year income higher than other method, although essentially the same. 500,000$ (e(cid:454). pg (cid:1005)(cid:1010)(cid:1004), (cid:272)ould"(cid:448)e sho(cid:449)(cid:374) (cid:1012)(cid:1004)(cid:1004),(cid:1004)(cid:1004)(cid:1004)$ o(cid:374)l(cid:455) (cid:271)ut (cid:449)ith detail in notes: stop recording depreciation and not include loss from operations because implied in fair value estimate of assets held for sale/sold. & irregular/incidental activities: help compare different companies & assess efficiencies. Income from discontinued operations are nonrecurring and have less predictive value: but they do give feedback value on past, pg.

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