FSA3e_Mod01_042612

Shouldthesellerrecognizethe

Info iconThis preview shows page 1. Sign up to view the full content.

View Full Document Right Arrow Icon
This is the end of the preview. Sign up to access the rest of the document.

Unformatted text preview: ge Business Publishers, 2013 Income Statement An income statement reports on operating activities. It lists amounts for sales (and revenues) less all expenses (and costs) over a period of time. Sales less expenses yield the “bottom­line” net income amount. ©Cambridge Business Publishers, 2013 Berkshire Hathaway’s Income Statement ©Cambridge Business Publishers, 2013 Net Income as a Percent of Sales ©Cambridge Business Publishers, 2013 Walgreen’s ©Cambridge Business Publishers, 2013 Initial Questions about the Income Statement ■ Assume that a company sells a product to a customer who promises to pay in 30 days. Should the seller recognize the sale when it is made or when cash is collected? ■ When a company purchases a long­term asset such as a building, its cost is reported on the balance sheet as an asset. Should a company, instead, record the cost of that building as an expense when it is acquired? If not, how should a company report the cost of that asset over the course of its useful life? Manufacturers and merchandisers report the...
View Full Document

This note was uploaded on 10/24/2012 for the course BACC 7101 taught by Professor Mark during the Spring '12 term at Seton Hall.

Ask a homework question - tutors are online