ACCG106 Lecture Notes - Lecture 7: Gross Profit, Tax Incentive, Quick Ratio

• School: Macquarie University
• Department: ACCG - Accounting and Financial Management
• Course: ACCG106
• Professor: All

Document Summary

Investment decisions are made at the present with an expectation of return and risk. The time dimension and that the future is unlikely to be the same as the past, but financial info can be useful in predicting the future. I(cid:374)ter(cid:374)al sour(cid:272)es: (cid:272)hair(cid:373)a(cid:374)(cid:859)s state(cid:373)e(cid:374)t, dire(cid:272)tors(cid:859) report, fi(cid:374)a(cid:374)(cid:272)ial state(cid:373)e(cid:374)ts a(cid:374)d notes, accounting poli(cid:272)y state(cid:373)e(cid:374)t, auditor(cid:859)s report. Trend analysis for predicting the future direction of items of interest on the basis of the trend of the items in the past (cid:894) 3yrs of data; (cid:271)ase year has (cid:448)alue of (cid:1005)(cid:1004)(cid:1004)(cid:895) Financial statement ratio calculated by dividing the dollar amount of one or more items reported in the financial statements by the dollar amount of one or more other reported items. Comparisons may be made: over time for the same entity (identify trend, with other entities in the same industry (intra-industry analysis, with industry averages, with entities operating in different industries (inter-industry analysis, with internal standards.