Chapter_2 - Review Review Assets are resources owned by a...

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Review Review Assets are resources owned by a business Examples: cash, prepaid expense, accounts receivable, notes receivable Liabilities are debts owed to outsiders (creditors) Examples: accounts payable, notes payable Owner’s equity is the owner’s right to the assets of the business after all liabilities have been paid
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Review Review Revenues are increases in owner’s equity as a result of selling services or products to customers Examples: fees earned, fares earned, commissions revenue, rent revenues, sales revenue Expenses result from using up assets or consuming services in the process of generating revenues Examples: wages expenses, rent expense, utilities expense, supplies expense, tax expense
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Review Review Accounting Equation Assets = Liabilities + Owner’s Equity
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Review Review Financial Statements In order of preparation Income Statement Statement of Owner’s Equity Balance Sheet Statement of Cash Flows Understand how these interact with each other
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Chapter 2 Please come see me if you do not Please come see me if you do not understand this material. This is the understand this material. This is the groundwork for the rest of the groundwork for the rest of the semester!! semester!!
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This note was uploaded on 02/07/2011 for the course BUS 209 taught by Professor Z.gougoumanova during the Spring '11 term at American University in Bulgaria.

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Chapter_2 - Review Review Assets are resources owned by a...

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