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Financial Acct

QuestionAnswer
Current Ratio Current Assets/Current Liabilities
Current Ratio use Does the company have the current ratio measures a company's ability to pay short-term obligations with short-term assets—a liquidity measure/low level of liquidity, below 1.0,
Investing Investing activities include buying and selling noncurrent assets and investments.
Financing Financing activities include borrowing and repaying debt, including short-term bank loans, issuing and repurchasing stock, and paying dividends.
what is shown in Cash flow You must see cash in the transaction for it to affect the statement of cash flows
debit left side
credit right side
Stockholders' equity— Stockholders' equity—the financing provided by the owners and by business operations.
Liabilities— Liabilities—probable debts or obligations acquired by the entity as a result of past transactions, to be paid with assets or services.
Assets— Assets—probable future economic benefits owned by the entity as a result of past transactions.
accounting equation: Assets = Liabilities + Stockholders' Equity
statement of cash flows statement of cash flows reports the sources and uses of cash for the period by the type of activity that generated the cash flow:operating, investing, and financing
Revenues REVENUES are increases in assets or settlements of liabilities from ongoing operations. are defined as increases in assets or settlements of liabilities from ongoing operations of the business.
expenditure expenditure is any outflow of cash for any purpose,
Expenses are decreases in assets or increases in liabilities from ongoing operations incurred to generate revenues during the period.
Operating Income Subtracting operating expenses from operating revenues gives Operating Income
Earnings per share Net Income ÷ Average Number of Shares of Stock Outstanding)
Created by: jennyfer55
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