230a_ch9 - Dr Loss CR Liability Disclose No disclosure...

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Chapter 9: Liabilities Balance Sheet: A = L + SE Assets Cash and Cash Equivalents Accounts Receivables Inventory Gross Plant, Property and Equipment (PPE) Less Accumulated Depreciation Net Plant Property and Equipment Intangibles Liabilities Accounts Payable Accrued liabilities Notes payable Current portion of long-term debt Long-term Debt Deferred taxes Bonds Income Statement: Rev – Exp = NI Revenue Gain on Sale of PPE Cost of Goods Sold Bad Debt Expense Depreciation Expense Amortization Expense Repair Expense Compensation Expense Interest Expense Income Tax Expense Loss on Sale of PPE Current liabilities
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Deferred taxes Dr Income tax Expense (from financial statements) CR Income taxes payable (from income tax return) Difference is debit or credit to deferred taxes payable. Contingent Liabilites Probable Reasonably possible Remote Can estimate loss
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Unformatted text preview: Dr Loss CR Liability Disclose No disclosure Cannot estimate loss Disclose Disclose No disclosure TIME VALUE OF MONEY Simple interest Compound interest Present value= current value of amount to be received in future Future value= the value of an amount in the future PV = PV factor (n= number of period, i= interest rate) * payment FV = FV factor (n= number of period, i= interest rate) * payment Factors from appendix A Now Future Present value ? $1 Future value $1 ? Present Value Example Assume the relevant interest rate is 6%. Would you rather receive a. A payment of $1,000,000 today b. Payments of $150,000 at the end of each of the next 10 years c. A payment of $500,000 today and payments of $160,000 at the end of each of the next 5 years (Hint: Compare the present values)...
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This note was uploaded on 03/02/2012 for the course BUISNESS 230a taught by Professor Stanley during the Fall '08 term at Sonoma.

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230a_ch9 - Dr Loss CR Liability Disclose No disclosure...

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