Reading Financial Documents Flashcards
(52 cards)
A balance sheet is only a
snap shot at that time
What are non current assets
something you expect to own for longer than a year
What are current assets
readily available to use or sel
Are liabilities classified into current and non-current
yes
Profit that isnt paid out to the owners/shareholder but kept in the business is called
retained earnings
What would prepaid expenses classified as and give an example
current asset, prepaying for an insurance policy that expires within a year
What income statement represents what timeline
beginning to end of fiscal year
Whats another name for the income statement
statement of operations
What are some examples of direct operating expenses and what does this term mean
Cost of goods sold
cost of sales
The costs of operating that are directly related to the good/services sold
What is gross profit
reveneus - direct operating expenses
What would be a some examples of indirect operating expenses
Advertising
Derpeciaton and amortization
insurance
EBIT/Operating income is what
Rev - direct and indirect expenses
What is net income/earnings
EBIT - interest and taxes
What does the cash flow statement do
breakdown where the money comes from and where it is spent: operating activities, investing, or financing activities
What are some examples of investing activities on the CF state
selling/buying non current assets
investing
What are some examples of financing activities on the CF state
issuing shares
paying dividends
issuing bonds
loan repayments
Where might a additonal info be located for any of the financial statements
notes
Where would random events that effected the financial results of a company be listed
extraordinary items
Who would be considered related parties
companies that are controlled by individuals that could have an influence on the reporting company
Officers and directors
Where to find compensation paid to management
related party transacitons
What else might be listed as a note
accounting policies
significant assumptions
commitments (not included in balance sheet)
contingent liabilities (maybe lawsuit)
subsequent events (something happened between reporting date and actual publication
Whats the biggest concern over accounts receivable
obsolensence - is it saleable
what are some examples of non-current assets
Prop/equipment
investments
Intangibles like good will or copywrighting costs
A credit analysts wants to understand the investments of a company because
those investments may influence future cashflows
