Module4Lecture6Notes - UGBA 10 Module 4 Lecture 6 Notes 4/7...

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UGBA 10 Module 4 Lecture 6 Notes 4/7 Accounting and Finance Review Questions Prentice-Hall prints up 100,000 copies of E&G this month and signs a contract to sell 100 of them to ASUC in June for $15 each. The books then sell at retail for $75. Revenue for April is A. Zero B. $1,500 C. $7,500 D. $1,500,000 Answer is A because April and June, they are sold during a different month Accrual Accounting Recognize revenues upon making a sale Recognize expenses in the period (e.g. month, quarter, year) when the related revenue is recognized So we can tell how a firm is doing Books aren’t shipped until June Review Questions What is the difference between income and net income on the income statement? A. Returns and allowances B. Selling, General, and Admin expense (SG&A) C. Corporate Income Tax Paid D. Interest Austria Population of 8 million people GDP/cap is approximately $45,000 Don’t have a port. How do they earn that much GDP/cap? Lots of palaces, cathedrals, monasteries How does their economy work? o Work on cakes o ½ population makes cake, other ½ teaches o Teachers buy cakes, and cake makers send children to teachers to learn How much is our simple T-shirt business worth Don’t sell just $300 because $900 is in inventory Double Entry Bookkeeping Paid monk to come up with a system of counting o An issue, ex. sell silk, promise to pay in 90 days, keep track of silk o Who owes us money? o
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This note was uploaded on 04/01/2008 for the course UGBA 10 taught by Professor Xuanmingsu during the Spring '08 term at University of California, Berkeley.

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Module4Lecture6Notes - UGBA 10 Module 4 Lecture 6 Notes 4/7...

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