Corporate Finance page 1 - Corporate Finance Chapter 2...

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Corporate Finance – Chapter 2 - Financial statements are firm-issued accounting reports with past performance information that a firm issues periodically. Public companies file financial statements quarterly (10-Q) and annually (10-K). They also send annual reports with financial statements to their shareholders. - Generally Accepted Accounting Principles – Rules for accounting - Auditor checks financial statements and follows GAAP - Four financial statements: balance sheet, income statement, statement of cash flows, and statement of stockholders’ equity - Balance sheet: all firm’s assets (left) and liabilities (right); Assets – cash, inventory, property, plant, equipment, and investments; Liabilities – firm’s obligations to creditors Current Assets: either cash or assets that could be converted into cash within one year – marketable securities (short-term, low risk investments easily sold or converted into cash like government debt which matures in a year), accounts receivable (amounts owed
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This note was uploaded on 01/11/2011 for the course ENG 120 taught by Professor Kaminsky during the Fall '10 term at University of California, Berkeley.

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Corporate Finance page 1 - Corporate Finance Chapter 2...

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