5.1 Business Accounts: Intro, TB and Accounting Flashcards
What do the accounts show
Value of company as a going concern
What does top half of BS show reader
NAV
Fixed assets are what
Non-current, providing lasting benefit to the company
What does TB break down into
P+L and BS
Why is BS different from TB
It is a snapshot on a given date, not for entire period
Current assets are what
Something that can be quickly sold
What is a long-term liability for ALCIE
Longer than a year
Why are drawings capital for ALCIE
Transactions between business and owner
Year-end adjustments are for what
BS
What do year-end adjustments do
Correct imbalance for pre-payment or accrual
What does BS record from ALCIE
ALC
What is included in financial statements
P+L account and BS
How do you work out NAV
Fixed assets + net current assets - long-term liability
Why is it strange for Sts to have capital for P+L
Business does not have separate legal personality
What is double-entry book-keeping
Every transaction has a dual effect on accounts
