Financial Accounting Ch. 4

Front 1

Classified Balance Sheet

Back 1

Presents the assets and liabilities of a business in
separate subgroups

Front 2

Classified Balance Sheet Common Groupings

Back 2

Current assets
Long term assets
Current liabilities
Long term liabilities
Stockholders’ equity

Front 3

Current Assets

Back 3

Cash and other assets that can be converted into cash or used up within the normal operating cycle, or one year, whichever is longer

Front 4

Long-Term Assets

Back 4

Assets the company does not expect to convert into cash during the normal operating cycle, or one year, whichever is longer

Front 5

Long-Term Assets Common Types

Back 5

Property, plant, and equipment
Intangible assets
Other long-term assets

Front 6

Property, Plant, and Equipment

Back 6

Land
Buildings
Equipment
Vehicles
Furnishing

Front 7

Intangible Assets

Back 7

Assets that lack a physical presence

Front 8

Common Examples of Intangible Assets

Back 8

Brand Names
Copyrights
Patents
Trademarks

Front 9

Current Liabilities

Back 9

Liabilities that must be settled within the normal operating cycle, or one year, whichever is longer

Front 10

Common Examples of Current Liabilities

Back 10

Accounts Payable
Accrued expenses payable
Short-term notes payable
Other current liabilities

Front 11

Long-Term Liabilities

Back 11

Debt obligations not due to be settled within the normal operating cycle, or one year, whichever is less

Front 12

Common Examples of Long-Term Liabilities

Back 12

Long-term notes payable
Bonds payable

Front 13

Stockholders' Equity

Back 13

The residual ownership interest in the assets of a business after its liabilities have been paid off

Front 14

Two major categories of Stockholders' Equity

Back 14

Common Stock
Retained earnings

Front 15

Balance Sheet Presentation

Back 15

Account Form
Report Form

Front 16

Account Form

Back 16

Assets on the left, Liabilities and Stockholders' Equity on right

Front 17

Report Form

Back 17

Assets on the top
Liabilities and Stockholders' Equity on bottom

Front 18

Multi-step Income Statement

Back 18

presents revenues and expenses in distinct categories to aid in financial analysis

Front 19

Net Sales

Back 19

The total revenue generated by a company through merchandise sales less the revenue given up through the sales returns and allowances and less the revenue given up through sales discount

Front 20

Gross Profit on Sales

Back 20

Cost of goods sold is subtracted from net sales

Front 21

Operating Expenses

Back 21

Expenses that relate to the company's primary operating activities

Front 22

Other income and expense

Back 22

Revenues and Expenses not part of primary operating activities

Front 23

Ratio Analysis

Back 23

Expresses one relevant number to another relevant number through division

Front 24

Working with the Balance Sheet

Back 24

Provides information on the firm’s financial health

Front 25

Liquidity

Back 25

Ability to pay short-term financial obligations

Front 26

Solvency

Back 26

Ability to pay long-term financial obligations; Measure of ability to survive over the long-term

Front 27

Profitability Analysis

Back 27

Analysis of profit, or income

Front 28

Working with the Statement of Cash Flow

Back 28

Provides information on the company’s change in cash over a period

Front 29

SRI

Back 29

Socially Responsible Investing

A firm’s environmental stewardship, consumer protection, human rights, diversity, and other social concerns