Financial Statement Presentation and Analysis

Financial Statement Presentation and Analysis - liabilities...

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Financial Statement Presentation and Analysis Balance Sheet Presentation Current liabilities are the first category under “Liabilities” on the balance sheet. Companies list each of the principal types of current liabilities separately within the category. Within the current liabilities section, companies usually list notes payable first, followed by accounts payable. Other items sometimes are listed in the order of their magnitude. In your homework, you should present notes payable first, followed by accounts payable, and then other liabilities in order of magnitude . Companies report long-term liabilities in a separate section of the balance sheet immediately following “Current liabilities.” Illustration 10-15 shows an example. Illustration 10-15 Balance sheet presentation of
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Unformatted text preview: liabilities Ethics Note Some companies try to minimize the amount of debt reported on their balance sheet by not reporting certain types of commitments as liabilities. This subject is of intense interest in the financial community. Disclosure of debt is very important. Failures at Enron, WorldCom, and Global Crossing have made investors very concerned about companies' debt obligations. Summary data regarding debts may be presented in the balance sheet with detailed data (such as interest rates, maturity dates, conversion privileges, and assets pledged as collateral) shown in a supporting schedule in the notes. Companies should report current maturities of long-term debt as a current liability....
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This note was uploaded on 11/08/2011 for the course ACCOUNTING ac 201 taught by Professor - during the Spring '11 term at Montgomery.

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Financial Statement Presentation and Analysis - liabilities...

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