AEB 3122 Chapter Notes - Chapter 9: Promissory Note, Sales Tax, Financial Statement
29 Mar 2017
School
Department
Course
Professor
Document Summary
Current liabilities of known amount: accounts payable, accounts payable turnover- the number of times a year a company is able to pay its accounts payable. To = purchases from suppliers (assumed all on credit) / average accounts payable. Purchases from suppliers = cogs (from income statement) + ei (from comparative balance sheet) bi (from comparative balance sheet) To in days (dpo) = 365 / to (see above) Higher turnover ratio is better than lower. Cannot calculate for service businesses: short-term notes payable- notes payable due within one year. Assets = liability + stockholder"s equity expenses. Assets = liabilities + stockholders equity + revenues: sales tax payable, accrued liabilities (accrued expenses)- usually results from an expense that the business has incurred but not yet paid. Payroll taxes payable: payroll liabilities- employee compensation. Salary- pay stated at a monthly or yearly rate.
