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3.12(last day for test 2)

3.12(last day for test 2) - Today's Topic Financial...

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Today’s Topic PLEASE TURN OFF CELL PHONES Financial Accounting Information System This class will: Differentiate assets from liability from equity Describe the difference in GAAP concepts for sale of long-term  assets, short-term assets and equity Introduce ratio analysis
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Fig 126 Assets v Debt v Equity assets : Resources available to be used to generate revenue Cash, receivables and/or property used in the future Debt ( ): Financing that must be repaid in the future to lenders Cash used to pay debt cannot be used to generate revenue or pay stockholders Equity Financing received from stockholders Assets minus Liabilities = stockholders’ share of the company
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Fig 127 Sale of Assets (to others by business) Sale Gain or Loss recorded (depends if Cash > or < Book Value) Reported separately from Expenses Sale of Inventory Cost of inventory sold is recorded and reported as Expense Covered in next part of the course
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Event 4 (Review):  On January 1, 2004, MMI paid  $12,000 cash to purchase computer equipment.
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