DOC PREVIEW
UA AC 310 - Exam 3 Study Guide
Type Study Guide
Pages 3

This preview shows page 1 out of 3 pages.

Save
View full document
View full document
Premium Document
Do you want full access? Go Premium and unlock all 3 pages.
Access to all documents
Download any document
Ad free experience
Premium Document
Do you want full access? Go Premium and unlock all 3 pages.
Access to all documents
Download any document
Ad free experience

Unformatted text preview:

AC 310 1st EditionExam # 3 Study Guide Lectures: 8 - 11Lecture 8 (February 3)Balance Sheet: Statements tell a story about the companyCurrent Assets: will be converted to cash or consumed within one year or the operating cycle- Cash/Cash Equivalents- Short-term investments- Receivables/Inventories/Prepaid Expenses**The correct order to present current assets is Cash, Marketable (trading) securities,accounts receivable, inventories, prepaid itemsNoncurrent Assets: not expected to be converted to cash/consumed within one year- Investments (bonds, stock, note receivable = securities)o Land held for speculation: fixed asseto Sinking fund, pension fund, cash surrender value Cash these aside to meet long-term obligations Cash surrender value: buy life insurance policies for key executives, part of monthly premium goes here; no access until he dies or leaves the company- PPE (Land held for speculation)/Intangible AssetsCurrent Liabilities: obligations that will not be satisfied within one year or the operating cycle- Accounts Payable/Notes Payable- Accrued Liabilities/Unearned Revenues- Current Maturities of long-term debtLong-Term Liabilities: obligations that will not be satisfied within one year- Long-term notes/long-term bonds- Mortgages- Pension obligations/lease obligationsShareholder’s Equity: - Capital Stock- Additional Paid-In Capital- Retained Earnings- Accumulated Other Comprehensive IncomeEvery item on the Balance Sheet IS a result of a past transaction.Balances sheet shows generating cash flows and assesses the ability to pay current obligations.BALANCE SHEET FORMATCurrent Assets:CashAvailable-for sale securitiesAccounts ReceivableNotes receivableInventoriesSuppliesPrepaid expensesTotal Current AssetsLong-Term Investments:Equity investmentsProperty, plant and equipment:LandBuildingsEquipmentLess: Accumulated DepreciationTotal PPEIntangible Assets:GoodwillCurrent Liabilities:Notes payableAccounts payableAccrued interestIncome taxes payableAccrued Salaries, wages, and other liabilitiesDeposits received from customersTotal Current LiabilitiesStockholders’ Equity:Paid in capitalCommon stockRetained earningsLecture 9 (February 5)Ratio AnalysisCurrent Ratio = Current Assets/Current LiabilitiesAcid-test ratio (quick ratio) = quick assets/current liabilitiesDebt to equity ratio = total liabilities/ shareholders’ equityTimes interest earned ratio = (Net income + Interest Expense + Income Taxes) / InterestExpenseLecture 10 (February 10)Statement of Cash FlowsThree different activities: operating, investing, financingOperating:Current Assets + Current Liabilities**Dividend RevenueInvesting:Noncurrent LiabilitiesFinancing:Long-Term Debt + Stockholder’s Equity**Note Payable, Cash dividendsTwo Methods: Direct Method & Indirect MethodDirect: does not include non-cash expensesIndirect: Starts with net incomeAdjusts for depreciation & other non-cash items (Depreciation, amortization,restructuring charges)Adjusts for non-operating gains and lossesSubtract GAINS and add back LOSSESAdjusts for timing differences with changes in current asset and liability accountsLecture 11 (February 24)Time Value of MoneyCalculator:N = number of periodsI = interestPV = present valuePMT = amount of annuity/paymentFV = future


View Full Document

UA AC 310 - Exam 3 Study Guide

Type: Study Guide
Pages: 3
Download Exam 3 Study Guide
Our administrator received your request to download this document. We will send you the file to your email shortly.
Loading Unlocking...
Login

Join to view Exam 3 Study Guide and access 3M+ class-specific study document.

or
We will never post anything without your permission.
Don't have an account?
Sign Up

Join to view Exam 3 Study Guide 2 2 and access 3M+ class-specific study document.

or

By creating an account you agree to our Privacy Policy and Terms Of Use

Already a member?