balance sheet basics correct answers - statement of financial position
- A=L+E
- as of a certain date
income statement basics correct answers - how did we do?
- stated period
3 activities in statement of cash flows correct answers operating, investing, financing
revenue reported correct answers when it is earned
expense reported when correct answers we receive the benefit, incurred
who needs info about:
- profitability of each division in the company correct answers management
, who needs info about:
- prospects for future dividend payments correct answers stockholder
who needs info about:
- prospects that the company will be able to pay its interest payments on time correct answers banker
who needs info about:
- prospects that the company will be able to pay for its purchases on time correct answers supplier
GAAP financial statements correct answers balance sheet, income statement, statement of cash flows,
statement of RE or SE, footnotes, 10-K, 10-Q
sole proprietorship correct answers - simple, easily established
- lack of experience
corporations (Inc.) correct answers - complex to establish, but then easier to transfer ownership
- personal liability limited
- BAD: dual taxation
LLC/ S. corp/ LLP correct answers - hybrid partnership/corp
- legal protection without dual tax issue
FASB, AICPA, SEC correct answers - FASB writes GAAP, statement of financial accounting standards
(SFAS)
- AICPA advises FASB
- SEC is governing body. of public companies and oversees independent firms via PCAOB
Act of 1993, 1934 correct answers - 1933: requirement for Initial Public Offering (to go public)
- 1934: reporting req for public companies
"What we learn to do, we learn by doing" correct answers Aristotle/ Thomas Jefferson ?
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