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BMAL 590 Business Finance_3 Exam Questions and Answers 100% Accurate
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BMAL 590 Business Finance_3 Exam Questions and Answers 100% AccurateBMAL 590 Business Finance_3 Exam Questions and Answers 100% AccurateBMAL 590 Business Finance_3 Exam Questions and Answers 100% AccurateGeneral Accepted Accounting Principles (GAAP) - ANSWER-the rules created by the U.S. government...

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  • November 1, 2024
  • 6
  • 2024/2025
  • Exam (elaborations)
  • Questions & answers

Subjects

  • bmal 590 business finance3 exam questions and ans
  • bmal 590 business finance3 exam answers
  • general accepted accounting principles gaap a

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  • BMAL 590 Business Finance
  • BMAL 590 Business Finance

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BMAL 590 Business Finance_3 Exam
Questions and Answers 100% Accurate
General Accepted Accounting Principles (GAAP) - ANSWER-the rules created by the
U.S. government for accounting. This requires public companies to generate financial
statements.

Financial Accounting Standards Board (FASB) - ANSWER-a body that examines
controversial accounting topics and issues standards that, in terms of their impact on
accounting practices, almost have the force of law.

Securities and Exchange Commission (SEC) - ANSWER-regulates publicly traded U.S.
companies as well as the nation's stock and bonds markets. It mandates that
companies generate financial statements following international accounting standards
(IAS).

Public Company Accounting Oversight Board (PCAOB) - ANSWER-Effectively gives the
EC authority to oversee the accounting professions activities.

4 Key Financial Statements required by the SEC are - ANSWER-1. balance sheet
2. income statement
3. statement of retained earnings
4. statement of cash flows

International Financial Reporting Standards (IFRS) - ANSWER-used in many countries
as the regulatory basis for the preparation of financial statements. Designed to provide
common global language for financial reporting, so that published information is
comparable across international boundaries.

Balance Sheet - ANSWER-Presents a 'snapshot' view of the company's financial
position at a specific moment in time. A firm's assets must equal the combined value of
its liabilities and the stockholders' equity. Assets = Liabilities + Stockholders' Equity.
Balance sheet entries:

1. Assets- The most liquid asset (cash) appears first and the least liquid (fixed assets)
come last.

2. Current Liabilities are those that must be paid within one year and include accounts
payable, notes payable, and accrued expenses. Long term liabilities - are due after
more than a year and include deferred taxes and long term debt.

3. Stockholders Equity - is the owners' residual share of the business, including their
original investment plus any money the firm has earned and retained since its inception.

, Includes preferred stock, common stock, paid-in-capital in excess of par, and retained
earnings.

Liabilities - ANSWER-are debts that the firm owes to others.

Current Liabilities - ANSWER-are those that must be paid within one year and include
accounts payable, notes payable, and accrued expenses. Includes

Accounts Payable are the amounts owed for credit purchases by the firm.

Notes Payable are outstanding short-term loans, typically from commercial banks.

Accrued Expenses are costs that have been incurred by the firm that have not yet been
paid.

Long term liabilities - ANSWER-are due after more than a year and include deferred
taxes and long term debt. Include deferred taxes and long-term debt.

Assets - ANSWER-Everything that can be used to benefit the business or give the
company the right to receive benefits.

Liquidity - ANSWER-is the length of time it takes to convert accounts into cash during
the normal course of business.

Balance Sheet Assets - ANSWER-Cash and cash equivalents are assets such as
checking account balances at commercial banks that can be used directly as means of
payment.

Marketable securities represent liquid short-term investments, which financial analysts
view as a form of "near cash." They include Treasury notes, commercial paper, and
others.

Accounts receivable represent the amount customers owe the firm from sales made on
credit.

Inventories include raw materials, work in process (partially finished goods), and
finished goods held by the firm.

Free cash flow (FCF) - ANSWER-is the amount of cash flow available to investors - the
providers of debt and equity capital. It represents the net amount of cash flow remaining
after the firm has met all operating needs and has made all required payments on both
long-term (fixed) and short-term (current) investments.

Operating cash flow - ANSWER-which is the amount of cash flow generated by the
firms operations.

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