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Chapter 2 - p.31 Book value asset – liabilities = book...

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Chapter 2 Financial statement 5/25/11 p. 26 Balance sheet will be dated on the date it was done , snapshot of that given day Format of the balance sheet ASSETS = Liabilities + Owners’ Equity Assets – economics resources that are owned by the company to generate revenues ex. Equipment, land, cash, building... etc. “Receivable” – anything with the word receivable is an asset Liabilities – obliquities that are owned by the company ex. Taxes payable “Payable” – anything with the word payable is a liability Owner equity the differences between assets and liabilities ex. Stock, retain earnings, revenues, expenses The balance sheet will not be balanced if the debit and the credit do not match up p.28 buying a car for 10000 assets = liabilities + owners’ equity car 1 equip +10000 cash -10000 car 2 equip +10000 cash – 1000 notespayable +9000
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Unformatted text preview: p.31 Book value asset – liabilities = book value of the business p.32 Income statement is a period of time jan – july 30,2011 which includes revenues, expenses, gains, losses, net income/netloss p.35 Gross margin or gross profit Retained earnings Debit (-) Credit (+) p.36 Cash flow statement is organized in 3 sections 1. Cash from operation activities (day to day operation) 2. Cash from financing activities – equity financing (stock)-Debit financing (bonds) 3. Cash from investing activities p.41 Notes to the financial statement are more important than the number itself p.44 Internal auditor – hired by the company, internal employee, and working directly for the company External auditor – outside company, certified company that work for the public, improve the quality of the company for the public...
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