12 Reporting Assets, Financing, and Cash Flows Flashcards
balance sheet
balance sheet reports the financial position of a business at a single point in time. unlike the income statement (over time)
basic accounting equation
relationship between balance sheet accounts that requires the balance sheet to balance.
current assets
Cash and other assets that are expected to be converted into cash within one accounting period (often a year)
Cash equivalents
securities investments that have a maturity of 90 days or less
short-term investments
, short-term securities with maturities greater than 90 days but less than one year,
accumulated depreciation
total amount of depreciation expensed over time against the fixed assets listed on the balance sheet
net fixed assets
The current accounting value, or book value, of a business’s property and equipment; calculated as gross fixed assets minus accumulated depreciation
current liabilities
Payment obligations of a business that are due in the next accounting period, often one year.
notes payable
alance sheet name typically used for a business’s short-term debt, often bank loans
accrued expenses
Monies owed to various parties, such as to employees, for services rendered. Also includes interest owed to lenders and tax obligations.
long-term debt
Debt financing that has a maturity greater than one accounting period
net assets
term used to designate the equity on a not-for-profit organization’s balance sheet.
common-size statements
Financial statements that are expressed in percentages rather than dollars . financial statements are created for entire industries, as opposed to individual businesses,
Statement of Cash Flows
an income statement that has been converted from accrual accounting to cash accounting. where a business gets its cash and what it does with that cash.
debt ratio
ratio that measures the proportion of debt (versus equity) financing. total debt (liabilities) divided by total assets
