100% satisfaction guarantee Immediately available after payment Both online and in PDF No strings attached
logo-home
Summary Chapter 2 - In-Depth Analysis of Financial Statements (Financial Accounting: Tools for Business Decision-Making, 6th Canadian Edition) - ADM 1340 CA$8.50
Add to cart

Summary

Summary Chapter 2 - In-Depth Analysis of Financial Statements (Financial Accounting: Tools for Business Decision-Making, 6th Canadian Edition) - ADM 1340

 2 views  0 purchase

A detailed exploration of financial statements, focusing on the classified statement of financial position, key financial ratios, and their implications for a company's liquidity, solvency, and profitability.

Preview 2 out of 15  pages

  • No
  • Chapter 2
  • December 23, 2024
  • 15
  • 2024/2025
  • Summary
book image

Book Title:

Author(s):

  • Edition:
  • ISBN:
  • Edition:
All documents for this subject (2)
avatar-seller
gigiadetunji02
Chapter 2: A Further Look Into
Financial Statements
2.1 - The Classified Statement of Financial
Position
A classified statement of financial position groups similar types of assets and similar types of
liabilities together.




Assets
● Resources a company owns or controls that provide future economic benefits by
generating cash flows.
○ Current Assets: Expected to be converted to cash, sold, or used up within
one year.
○ Non-Current Assets: Benefits will be realized after more than one year.

, Current Assets
● Expected to be converted to cash, sold, or used up within one year or operating
cycle.
● Operating Cycle: Time between paying for products/services and receiving cash
from customers. Usually less than a year but can be longer for certain industries.
● Listed by liquidity (how easily they turn into cash):
○ Cash: Money in hand or deposited.
○ Trading Investments: Investments in securities intended to be sold within a
year.
○ Accounts Receivable: Money owed to the company by customers.
○ Notes Receivable: Money owed to the company, usually with interest.
○ Inventory: Goods held for sale or production.
○ Supplies: Consumable items like office and cleaning supplies.
○ Prepaid Ex penses: Costs like rent or insurance paid in advance.


Non-Current Assets
Usually Not Titled “Non-Current Assets” in the Statement of Financial Position, but titled
as “Current Assets”, “Long-Term Investments”, “Property, Plant and Equipment”
● Long-term Investments: Investments held for many years to earn income.
○ Debt Securities: loans, notes, bonds, mortgages
○ Equity Securities: shares of other companies
● Property, Plant, and Equipment: Tangible assets with long useful lives (e.g., land,
buildings, machinery, equipment).
● Depreciation: Spreading the cost of these assets over their useful lives (except land,
which is not depreciated).
○ Carrying Amount: assets that are depreciated
● Intangible Assets: Assets with no physical substance (e.g., patents, copyrights).
○ Amortization: Similar to depreciation, but for intangible assets with a limited
life.
○ Goodwill: Excess amount paid when buying another company, representing
things like reputation and employee quality.

The benefits of buying summaries with Stuvia:

Guaranteed quality through customer reviews

Guaranteed quality through customer reviews

Stuvia customers have reviewed more than 700,000 summaries. This how you know that you are buying the best documents.

Quick and easy check-out

Quick and easy check-out

You can quickly pay through credit card or Stuvia-credit for the summaries. There is no membership needed.

Focus on what matters

Focus on what matters

Your fellow students write the study notes themselves, which is why the documents are always reliable and up-to-date. This ensures you quickly get to the core!

Frequently asked questions

What do I get when I buy this document?

You get a PDF, available immediately after your purchase. The purchased document is accessible anytime, anywhere and indefinitely through your profile.

Satisfaction guarantee: how does it work?

Our satisfaction guarantee ensures that you always find a study document that suits you well. You fill out a form, and our customer service team takes care of the rest.

Who am I buying these notes from?

Stuvia is a marketplace, so you are not buying this document from us, but from seller gigiadetunji02. Stuvia facilitates payment to the seller.

Will I be stuck with a subscription?

No, you only buy these notes for CA$8.50. You're not tied to anything after your purchase.

Can Stuvia be trusted?

4.6 stars on Google & Trustpilot (+1000 reviews)

53022 documents were sold in the last 30 days

Founded in 2010, the go-to place to buy study notes for 14 years now

Start selling
CA$8.50
  • (0)
Add to cart
Added