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Financial Statements
A financial statement is a record of the financial activities of a person or business entity where all related financial information are presented in an orderly manner and can be easily understood.
5,583 Questions
Who plays a role in the financial activities of a company?
Everyone at the company, including managers and employees
What statement reflects proper handling of controlled unclassified information?
During duty hours, you must not read CUI where unauthorized personnel are present
Reliability
What is gross operating expense?
Gross operating expense is the total amount of money spent by a company to operate its business, including costs such as salaries, rent, utilities, supplies, and other day-to-day expenses. It does not include taxes or interest expenses.
Where the interest expense in cash flow statement?
Interest expense can be shown in cash flow from operating activities as well as cash flow from financing activities as well.
Where does overdraft go to balance sheet or profit and loss account?
Bank overdraft is shown in balance sheet either as a negative amount of bank in asset side or at liability side of balance sheet.
What order are financial statement prepared?
Income Statement, Retained Earnings Statement, Statement of Equity, Balance Sheet, and then Statement of Cash Flows.
What is the difference between a primary owner and a co-owner of a business?
Often a question of control. Primary owner may retain majority interest and let one or more co-owners have limited vote in proportion to percentage ownership.
Where can you find Bose Corporation's 10-Q form?
Bose Corporation is a privately held company, and therefore does not file Form 10-Q with thee U.S. Securities and Exchange Commission (SEC).
However, if it were a publicly-held corporation, you could find its SEC filings (for example, the 10-Q) on the SEC's website, SEC dot GOV.
Is discount received balance sheet item or not?
It's only treated in income statement, not balance sheet.
Why is unrealized gross profit considered a liability in the balance sheet?
Basically, unrealized gross profit is not an asset, liability, expense, revenue and owner equity.
Because asset always record in DR side as a nature.
Liability record on CR side but we don't have to pay any thing in unrealized gross profit.
expense nature is DR
revenue nature is CR but unrealized gross profit is expected to be an income after realizing.
owner equity means to invest in business and unrealized gross profit is not an investment.
So, we have to assume the unrealized gross profit as liability because it is mutually unearned. Unearned, it is an advance amount which is liability until we earned it. Similarly, unrealized is expected to be earned in future after collecting the installments of sales, as unearned is a part of liability so, unrealized gross profit is also a part of liability through unearned account.
What is true-up in financial term?
True up period is the period within which the charges and costs involved in an agreement are revised after the commencement of the contract. For instance, within 30 days after the commencement date the parties will agree on a revised charges workbook based on a revised sites and services list.
Basically, at the negotiations stage parties tentative decide on the costs and charges that will be incurred in the execution of their obligations under the contract. However, it is only after the negotiations are complete that they know exactly what is the scope of the services/goods and the area where the services/goods are to be provided and accordingly, they revise the charges for the same based on the final costs that will be involved in carrying out the obligations in the agreement.
What is payback period in financial accounting?
1. Payback period is an evaluating tool of any business capital expenditure that how much time it requires to fully recover the initial investment in any project for example:
if a project require 100 investment and returns as follows:
Year 1 60
year 2 20
year 3 20
year 4 10
so payback period to recover 100 is 3 years.
Is income the same thing as revenue how?
Yes, income is the same thing as revenue, however there are key words to help distinguish between the types of "income" or revenue.
Revenue (sometimes referred to as income) is the money a company receives from providing a good or service. Sales Revenue or Sales Income are a good example of how Revenue and Income can be interchangeable. Both refer to the same thing, money brought into a business from "sales".
Gross Income (rarely referred to as Gross Revenue) is the income a company has after the cost of goods sold are deducted.
Net Income is basically the what's remaining of the Gross Income after all expenses such as Taxes, Salaries, Etc are paid.
Retained Earnings is the final step. Retained earnings is simply PROFIT. It is what the company has after dividends are paid out of Net Income, if applicable. Retained earnings is what the company literally made after all COGS, Expenses, and Dividends are paid.
Advance subscription of shres
Why does Marketable securities located on a balance sheet?
Marketable securities are assets of company which can be converted immediately to acquire cash as and when needed.
Where does carriage inwards due go in the balance sheet?
debit side of the Trading and Profit & loss Account
What is the difference between Cash and cash equivalents and Cash provided by operating activities?
Difference between cash and cash equivalent is that cash equivalent is not cash like other cash but it is so liquid that it can be converted to cash immediately when required like marketable securities while cash provided from operating activities means cash generated by selling goods to customers.
How should reserves be handled on the balance sheet for a condo association?
Generally, since there is no standard for accounting and financial reporting for associations, it's a good idea to handle your reserves in such a way so that the membership can easily understand the position of reserves on the balance sheet.
Here's a format that works for many associations:
**Reserve funds listed according to the purpose of the fund, such as
- Insurance Fund
- Special Projects Fund
- Replacement Fund
- (Other Title) Fund
As well, some balance sheets show three columns: current, prior month and change. This way members can understand how each month's contribution grows each fund.
Finally, you can list (detailed) fund equity YTD in the liabilities and equity section of the balance sheet, as negative numbers. Of course, the current month column in both assets and equity/ liability must be equal to each other.
How do you journalize accrued selling expenses?
[Debit] Selling Expenses
[Credit Selling expense payable
Does sales tax payable have a normal credit balance?
All payable maintain a credit balance. A payable is a liability account and therefore like a liability does increase with a credit and decrease with a debit.
How does estimated liabilities affect the financial statements?
Two forms of estimated liabilities (IAS 37)
-Provisions (liabilities which are uncertain in timing or amount)
-Contingent Liabilites (possible obligation where either the amount cannot be reliably measured or the outflow is not probable)
A Provision would be recorded as a normal liability however it would be measured at the Present Value of the best estimate required to settle the obligation
(also requires substantial note disclosure) Note: Will result in defered tax!
A Contingent liability will result in only note disclosure- and thus will have no effect on the quantintative aspect of the financial statments.
