Lecture 24 Flashcards Preview

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Flashcards in Lecture 24 Deck (16)
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1
Q

what are the objective of financial statements?

A

provide info about the financial position, performance and changes in position of enterprise that is useful to wide range of users making economic decisions

2
Q

what is a balance sheet?

A

reports on company’s assets, liabilities, and ownership equity at given point in time

3
Q

what is an income statement?

A

reports on company’s income, expenses, and profits over reporting period and provides information on the operation of the enterprise

4
Q

what is a cash flow statement?

A

reports on company’s cash flow activities, particularly its operating, investing, and financing activities

5
Q

what are cash equivalents?

A

money market holdings, short term govt bonds or t-bills

6
Q

what are marketable securities?

A

commercial paper

7
Q

cash equivalents are distinguished from other investments through their..?

A

short term existence; they mature within 3 months

8
Q

can common stock be considered cash equivalent?

A

no, but preferred stock acquired shortly before its redemption date can be

9
Q

what are trade receivables?

A

receives owed by the company’s customers

10
Q

what are non-trade receivables?

A

amounts due from employees and income tax refunds

11
Q

what are deferred tax assets?

A

assets that may be used to reduce any subsequent period’s income tax expensel often associate dwith loss carryover, and is used as a future write-off if next tax period is expected to produce positive earnings

12
Q

non-current assets are defined as..?

A

anything not classified as current asset: long term marketable securities; PP&E; Intangible assets; Goodwill

13
Q

what are intangible assets?

A

IP; trade secrets, copywrights, patents, trademarks; competitive intangibles (human capital; organizational know-how, collaboration activities)

14
Q

what is goodwill?

A

technically intangible asset; typically comes into play only in an acquisition and represents amount of money a company has paid or would pay over book value to acquire another company

15
Q

what are non-current liabilities?

A

bank and bondholder debt typically

16
Q

what is paid in capital?

A

amount of money shareholders paid for their shares when stock was first offered to public; basically represents how much money firm received when it sold its shares