-
Temporary Investements r:
- securities held by a firm which are
- 1. readily marketable
- 2. intended to be converted to cash w/n the next year or operationg cycle of the business.
-
Will temporary Investments always be classified as LONG TERM INVESTMENTS?
No, only if it meets both criterias
-
what is marketable DEBT securities?
- security which represents a debt owed by one party to another party
- EXAMPLE: goverment and corporate bonds.
-
what is marketable EQUITY securities?
- security which represents an ownership interest in coroporation
- EXAMPLE: common stock
-
companies related to each other in same way are
affilated companies
-
a company that owns more than 50% of another company
parent company
-
a company that owns more than 50% owned by another company is
subsidiary
-
when transitions between affilates r eliminalted in the consolidation process
it is an intercompany elimination
-
when one company sells product to another company with in the same family
intercompany transaction
-
the result of a parent company financial statements are combined with financial states of subsidiary
consolidated financial statements
-
this exist when 1 company ownes more than 50% of another company and individuals can also do this
controlling interest
-
definition, value, unrealized gains & losses and realized gains & losses of TRADING SECURITIES
- definition: stocks and bonds bought and held primariy for sale n the near future to generate income on short term price difference.
- reported at fair value
- unrealized on the income statement
- realized on the income statement
-
definition, value, unrealized gains & losses and realized gains & losses of AVAILABLE FOR SALE SECURITIES
- definition: stocks and bonds which may be sold in the future but may also be held for an extended period of time.
- FAIR VALUE
- unrealized gains or losses reported as a seperate coponent of stockholders equity
-
definition, value, unrealized gains & losses and realized gains & losses of HELD TO MATURITY SECURITIES
- definition: debt securities (bonds) which the investor has both the intent and ability to hold until maturity.
- reported on the balance sheet of historical cost with NO recongition of unrealized being ok.
-
explain operating activites
- * income statement item
- * net income or net lost
- * adjustment for gain(-) or lost (+)
- * " " non cash (depreciation)
- changes in current liabilities (acct paya./tax paya/acc. liabilities)
- " " in current assets (acc. rec. / investments/ reduces net income)
-
what are examples of operating activities
- collected $ of acc. recievables
- paid $ of acc. payable
- depreciation
- loss on sale of land
- paying a note of recievables
- receipt on interest
- amortization of patent
-
what is investing activities
- changes in investments & long term assets
- pp & e (property, plant, & equipment)
-
what are examples of investing activities
- sold long term investment
- sale of building at book value
- purchase of land
-
what is financing activities
- changes in long term liabilities & stock holders quity
- cahnges in non current liabilities
- changes in stockholders equity items
- bonds
-
give examples of financing activities
- issued $ par value c/s for cash
- declared and paid cash dividends
- issuance of capital stock
- retirement of bonds
-
what are the 3 essentials for statment of cash flow
- 1. comparative balance sheets
- 2. income statement of equivalent information
- 3. additional information not on financial statement
-
when ASSETS & STOCKHOLDERS EQUITY goes up what else goes up?
CASH
-
when ASSETS & STOCKHOLDERS EQUITY GOES DOWN what else GOES DOWN
CASH
-
LIABILITIES GOES UP
CASH GOES DOWN
-
LIABILITIES GOES DOWN
CASH GOES UP
-
LOOK AT EXAMPLES OF HOMEWORK
LOOK AT EXAMPLES OF PRACTICE PROBLEMS
|
|
