100% satisfaction guarantee Immediately available after payment Both online and in PDF No strings attached
logo-home
Finance summary $4.81
Add to cart

Summary

Finance summary

 79 views  3 purchases
  • Course
  • Institution

finance summary for the first-year facility and hotel students at BUAS

Preview 2 out of 10  pages

  • January 2, 2020
  • 10
  • 2019/2020
  • Summary
avatar-seller
Finance Summary

Financial accounting fundamentals:
- Matching principle: it requires that a company records expenses in the same period
in which its related revenues are earned.
- accrual basis: requires recording revenues when they are earned and not when they
are received in cash and recording expenses when they are incurred and not when
they are paid.
- recognition: selling goods or services are recognized in the period in which the
goods are sold and delivered and the Services when are performed.
accruals/ prepayments → rising current assets and current liabilities.
- conservatism: requires companies not to overstate revenues, understate expenses,
overstate assets, understate liabilities.
- materiality: refers to the impact of incorrect or missing information in financial
statements.
- full disclosure: concerns the need to disclose all material and relevant information
about all business activities within a reporting period in the financial statements.
- going concern: concerns the assumption that a firm will operate indefinitely in the
future, therefore the continuity of its business is assumed.


Assets = Liabilities + owners equity (in balance)

What you
What you own owe
Liabilities
Assets
Net worth
Owners equity

assets:
- cash
- amounts owed to us by customers (accounts receivable),
- cars, buildings, suppliers, land and equipment, etc.

liabilities:
- loan
- owe money to a company or to our employees (wages payable or salaries payable)
- accounts payable, bought something on credit (unearned revenue)
(payable: we would have to pay it at some point)

equity:
- capital account (startkapitaal): that tracks the owner or owner’s balance
- withdrawals (dividends) the amount an owner takes from built equity
- revenues/sales: the amount you would earn from selling goods or services.
- expenses: the amounts that we pay out for (salaries, gas)

when revenues and expenses are recognized either before or after the flow of cash, there
are 4 accrual combinations:

, 1. unearned revenue: cash received before revenue is earned
2. accrued revenue: sales revenue is recognized before cash is received (Asset)
3. accrued expense: expense or obligation is recognized before cash is paid
4. prepaid expenses: cash is paid before expense or obligation is recognized.

Supplies / inventory = voorraad

Beginning Inventory + purchases + shipping - Ending Inventory = cost of goods sold

Income statement: shows what a company has earned, what it has paid, what is the
resulting profit or losses over a certain period of time.
Balance sheet: shows what the company owns, what it owes, and what it´s worth.
Statement of cash flow: shows how much cash the company has brought in, and how
much it is paid out.




Total assets:
● current assets: used within one year (cash, inventory, accounts receivable)
● non-current assets: last more than a year
- tangible: you can touch (car, plan and equipment, property)
- intangible: you can´t touch (patents, trademarks)

Total Liabilities:
- current liabilities: must be paid within 1 year (accounts payable)
- non-current liabilities: due in more than a year (Leases, long term debt)

Shareholders equity:
- common shares
- retained earnings, these can either remain and therefore invested or they can be paid
out in dividends, reducing retained earnings.

income statement = revenues - expenses
provides detailed results of a company´s operations over a period of time.

unearned revenue: liabilities, you already received the money for services/goods you will
provide somewhere in the future.

gross profit = contract price - EAC
taxes = btw

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 gitteslegers. Stuvia facilitates payment to the seller.

Will I be stuck with a subscription?

No, you only buy these notes for $4.81. You're not tied to anything after your purchase.

Can Stuvia be trusted?

4.6 stars on Google & Trustpilot (+1000 reviews)

53068 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
$4.81  3x  sold
  • (0)
Add to cart
Added