Review for AC202

Assets cash accounts receivable supplies total

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Unformatted text preview: ries Furniture Fixtures Equipment Supplies Which ones would be current assets? Liabilities – typical accounts Liabilities – typical accounts Obligations or debts of business Notes payable Accounts payable Interest payable Salaries payable Unearned revenue Stockholders’ Equity Stockholders’ Equity Ownership claims on assets Common stock Retained earnings Basic Accounting Equation Assets = Assets Liabilities + Stockholders’ Equity Liabilities Accounting Equation Assets = Liabilities + Stockholders’ Equity This is important to remember If you have done all of your work correctly, the ASSETS will always equal the total of the LIABILITIES and the EQUITY Accounting Equation Assets Assets = Liabilities Liabilities Assets + Liabilities & Equity Equity Equity Statement of Retained Earnings and Statement of Stockholders Equity Stockholders’ Equity: Retained Earning Common Stock Since both of these parts affect stockholders’ equity… a statement of stockholders’ equity provides better information than a statement of retained earnings. Differences Retained Earnings Statement Shows income for period Shows dividends for period Statement of Stockholder’s Equity Shows income for period Shows dividends for period Shows change in stock (issued or repurchased) Statement of Statement of Stockholders’ Equity Example from pg. 57 of your text General Guide for Financial Accounting Generally Accepted Accounting Principles Primary Accounting Setting Body in the U.S. Financial Accounting Standards Board U.S. Government Agency That Oversees Financial Markets Securities Exchange Commission GAAP Are the Rules The FASB makes the rules. The SEC enforces the rules. IASB = International Accounting Standards Board The Accounting Cycle Analyze Journalize transactions. Post entries to the ledger accounts. Prepare trial balance. Prepare after closing Journalize and Prepare post closing financial trial balance. entries. statements. Make end-ofyear adjustments. Prepare adjusted trial balance. 318 End 319...
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