ACCT 1A Lecture Notes - Lecture 1: Cash Flow Statement, Sole Proprietorship, Current Liability

• School: Irvine Valley College
• Department: Accounting
• Course: ACCT 1A
• Professor: Urell

Document Summary

Income statement: may be referred to as profit and loss statement. Balance sheet: reports a company"s assets, liabilities and equity at a given point in time. Accounting equation: assets = liabilities + equity. Cash flow statement: reports a company"s cash inflow and outflow from its operating, investing and financing activities, qualitative characteristics. Understandability, relevant, reliability, comparability, consistency, materiality, conservatism. A consolidated balance sheet groups together accounts of similar nature and reports them in a few major classifications. Current assets are listed in order of their liquidity. Current liability is an obligation that is reasonably expected to be satisfied within one year. Non- current, long term or even fixed assets are expected to be converted to cash in a period long than one year. Non- current or long term liabilities are considered to be obligations beyond one year: income statement. Report the components of profit and loss.