BSM 100 Lecture Notes - Lecture 8: Accounts Payable, Current Liability, Financial Statement

• School: Ryerson University
• Department: Business Essentials
• Course: BSM 100
• Professor: Ranjita Singh

Document Summary

Financial accounting: for those on the outside, looking in. The branch of accounting that addresses the needs of external stakeholders, includes, financial statements to provide broad information. Financial accounting includes three basic financial statements. Financial position of the company at a point in time. Assets: uses of funds, things of value, where we put all the money we have raised over the fears. Current (liquid) assets: things of value that the firm will convert to cash within a year (cash, accounts receivable, inventory) Fixed assets: things of lasting value that he firm uses in the business (equipment, building, land, investments, patents etc. ) Provision for bad debts (subtract from assets) Liabilities and owner"s equity: sources of funds. Current liabilities: debts that the firm will pay back within a year. Long-term liabilities: debts that the firm will pay in longer than one year (bank loans) Shareholders" equity: owners claims against the assets (shares/stockholders) retained earnings.