Business Activities
What are the three types of business activities?
-Financing Activities
-Investing Activities
-Operating Activities
What is the accounting equation?
Assets=Liabilities+Stockholders' Equity
What are the financial statements in order?
-Income Statement
-Statement of Stockholders' Equity
-Balance Sheet
-Statement of Cash Flows
What is the Account Classification and Financial Statement for Accounts Payable?
-Liability
-Balance Sheet
Who/What is involved with transactions involving financing activities?
Investors and Creditors
What is/are the formula(s) for the Income Statement?
Revenue - Expenses = Net Income (Net Loss)
What does the Income Statement do?
It assesses the company's ability to earn a profit from its operations for the current period
What is the Account Classification and Financial Statement for Retained Earnings?
-Stockholders' Equity
-Balance Sheet
Who/What is involved with transactions involving investing activities?
Resources benefiting the company for several years?
What is/are the formula(s) for the Statement of Stockholders' Equity?
Common Stock BBCS + Issuance CS = EBCS
Retained Earnings BBRE + Net Income - Dividends = EBRE
EBCS + EBRE = EB Total Stockholders' Equity
What does the Statement of Stockholders' Equity do?
It reports changes in common stock and retained earnings for each period
What is the Account Classification and Financial Statement for Salaries Expense?
-Expense
-Income Statement
Who/What is involved with transactions with operating activities?
The primary operations of the company
What is/are the formula(s) for the Balance Sheet?
Assets = Liabilities + Stockholders' Equity
What does the Balance Sheet do?
It demonstrates that the company's resources (assets) equal creditors' claims (liabilities) plus owners' claims to those resources (stockholders' equity) on a particular date
What is the Account Classification and Financial Statement for Cash?
-Asset
-Balance Sheet
Classify these examples
-Purchase common stock from another company
-Pay the amount owed to the bank for previous borrowing
-Pay taxes to the IRS
-Investing Activities
-Financing Activities
-Operating Activities
What is/are the formula(s) for the Statement of Cash Flows?
CF from Operating + CF from Investing + CF from Financing = Net Change in Cash
Net Change in Cash + BB Cash = EB Cash
What does the Statement of Cash Flows do?
It reports cash transactions from operating, investing, and financing activities for the period
What is the Account Classification and Financial Statement for Service Revenue?
-Revenue
-Income Statement