the course

Accounting And Finance
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Accounting And Finance
Liabilities : Obligations of the firm to outsiders or claims against its assets by
outsiders (debts of the firm).
Assets : Resources of the firm that are expected to increase or cause future cash
flows (everything the firm owns)
Owners’ Equity : The residual interest in, or remaining claims against the firm’s
assets after deducting liabilities (rights of the owners)
Accounting : A process of identifying, recording, summarizing and reporting
economic information to decision makers in the form of financial statements.
Annual report : A document prepared by management and distributed to current
and potential investors to inform them about the company’s past performance and
future prospects.
© 2015
Accounting And Finance
Accounting information is useful to anyone who
makes decisions that have economic results.
© 2015
Accounting And Finance
In Accounting , An Itemized Statement of What one owns and What one
owes is called a Balance
The balance sheet equation = Assets
- Liabilities
© 2015
Accounting And Finance
Balance Sheet Reports What a Business:
Owns – Assets
Owes – Liabilities
Worth – Owners Equity
© 2015
Accounting And Finance
Income Statement reports how much you earned Last Year
 Revenue
 Expense
 Profit
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Accounting And Finance
What is the need for Accounting & Finance in a Business:
Forecast future
© 2015
Accounting And Finance
Match the following
1. Accounts receivable
A. Borrowed money which the company must
pay back within a year.
2. Prepaid expenses
B. The money owed to a business by its clients
3. Account payable
C. Intangible assets like a company’s brand
name and established relationships with its
4. Stock / Inventory
D. Costs paid in advance such as rent and
5. Plant & Equipment
E. The money a company has received from
outside investors for its shares
6. Share capital
F. The money owed by a business to its
7. Goodwill
G. The goods and materials that a business
holds for the purpose of resale
8. Short-term debt
H. What a company owns and uses to produce
goods, such as factory and machinery.
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Accounting And Finance
1)Expense Tangible 2)Financial Statements 3)Balance Sheet 4)Profitable
5)Intangible 6)Tangible
For a business enterprise, all the relevant financial information is presented in
a structured format that is easy to understand. These are called ________ .
There are several important financial statements.
Managers want to know if a new product will be _____________
An outflow of cash or other valuable assets from a person or company to
another person or company is an ___________
In Accounting , An Itemized Statement of What one owns, What one owes,
What one s worth is called a _______________
________ assets are physical things , for example machines and property.
________ assets are not physical in nature, for example a company's
© 2015