ORIE 3150 class 1

ORIE 3150 class 1 - ORIE 3150 August 27, 2009 1. Definition...

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ORIE 3150 August 27, 2009 1. Definition of accounting. 2. Definition of a business and the goals of a business 3. Three types of business activities: a. Operating b. Financing c. Investing 4. Financial accounting – what it is and what it is not. 5. We will study financial accounting as done in the USA. 6. Generally Accepted Accounting Principles (GAAP) are followed. 7. The balance sheet: it includes a. Assets b. Liabilities c. Stockholder’s Equity These amounts must satisfy the accounting equation: A = L + SE
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8. The income statement a. Revenues b. Expenses c. Revenues – Expenses = Net Income Net income > 0: “profit” Net income < 0: “loss” 9. The cash flow statement a. Classifies each cash inflow or outflow by type of business activity b. Many business activities do NOT involve cash flows, so it is important to look at the ones that do involve cash very carefully. Cash = currency + checking account balances + cash equivalents Numerical Examples: 1. Use the accounting equation to answer each question below.
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This note was uploaded on 03/02/2011 for the course ORIE 3150 at Cornell.

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ORIE 3150 class 1 - ORIE 3150 August 27, 2009 1. Definition...

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