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Unformatted text preview: Module 4 Lecture 5: 11/7/08 Balance Sheet In business people often refer to growing the top line. Top line means- Revenue Is it possible to tell from the Income Statement that sbux owes no money to banks?- Yes because you would see the Interest Paid on the income statement HSM3!!!!!!- Troy Bolton forgoes a scholarship to U of Albuquerque to declare for UC Berkeley!- So he can do basketball and theater. Financial Accounting II Double Entry Bookkeeping Fundamental Accounting Equation Balance Sheet How Much is our Simple T-Shirt Business Worth? We paid $90 for the screens last year We begin this month with $1,200 Buy 100 t-shirts for $9 $900 Cash we have left: $300 Is our firm only worth $300? No. We still have $900 inventory EX: At the beginning of the month: We paid $90 for the screens last year We begin this month with $1,200 cash Value of our firm is $1,200 Later on in the month: We paid $90 for the screens last year We now have $ 300 cash and Inventory of $ 900 Value of our firm is still $1,200 Double Entry Bookkeeping ( Keeping the books in balance shows good record keeping) Double entry Bookkeeping A system in which each transaction results in two entries A system of debits and credits in which the Accounting Equation must always remain in balance (In this example, Cash goes down but Inventory goes up ) Double Entry Bookkeeping...
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- Spring '08