Corporate finance Flashcards
3 types of financial statements
Income statement
Cash flow statement
Balance sheet
Income statements computes ____ or ____ during a giving _____ based on date about _____ and _____.
profit or loss
period
revenue
costs
Income statements show __ _____.
net income!
formula for income statements
revenue - expenses
depreciation is found which financial statement?
income statement
Depreciation is an _____ _____ used to allocate the cost of a ____ ___ over its useful ____ ______.
an accounting method
tangible asset
life expectancy
A balance sheet shows the company’s _____, ____ and the ____ ____ in the business at a ______ point in time.
assets, liabilities and the owner’s equity
particular
3 sections on a balance sheet
Assets, liabilities and owner’s equity
Assets are _____.
the business’s stuff.
Assets can be ___ term and ___ term.
long
short
Liabilities are ___
what the company owes.
Examples of assets [both long + short}
Short term: cash, accounts receivable, inventory, prepaid expenses [insurance]
Long term: stocks, bonds
Examples of liabilities [both long + short]
Short term: accounts payable, salaries, payable taxes
Long term: liabilities: mortgages, car payments, land
Owner’s equity is ___
what is leftover after subtracting liabilities from assets
Basic accounting formula
Assets = liabilities - owner’s equity.
