TAILIEUCHUNG - Lecture Intermediate accounting (4/e): Chapter 3 - Spiceland, Sepe, Tomassini

Chapter 3 - The Balance sheet and financial disclosures. The balance sheet, along with accompanying disclosures, provides relevant information useful in helping investors and creditors not only to predict future cash flows, but also to make the related assessments of liquidity and long-term solvency. The purpose of this chapter is to provide an overview of the balance sheet and financial disclosures and to explore how this information is used by decision makers. | The Balance Sheet and Financial Disclosures 3 Chapter 3: The Balance Sheet and Financial Disclosures Learning Objectives Describe the purpose of the balance sheet and understand its usefulness and limitations. LO1 Our first learning objective in Chapter 3 is to describe the purpose of the balance sheet and understand its usefulness and limitations. The Balance Sheet Limitations: The balance sheet does not portray the market value of the entity as a going concern nor its liquidation value. Resources such as employee skills and reputation are not recorded in the balance sheet. Usefulness: The balance sheet describes many of the resources a company has available for generating future cash flows. It provides liquidity information useful in assessing a company’s ability to pay its current obligations. It provides long-term solvency information relating to the riskiness of a company with regard to the amount of liabilities in its capital structure. The purpose of the balance sheet is to report a company’s financial position on a particular date. The purpose of the balance sheet is to report a company’s financial position on a particular date. It is a freeze frame or snapshot of financial position at the end of a particular day marking the end of an accounting period. A limitation of the balance sheet is that assets minus liabilities, measured according to generally accepted accounting principles, is not likely to be representative of the market value of the entity. Many assets, like land and buildings, are measured at their historical costs rather than their market values. Relatedly, many company resources including its trained employees, its experienced management team, and its reputation are not recorded as assets at all. However, despite these limitations, the balance sheet does have significant value. The balance sheet provides information useful for assessing future cash flows, liquidity, and long-term solvency. Resources (Assets) Claims against resources .

• Kế toán - Kiểm toán
• Intermediate accounting
• Lecture Intermediate accounting
• Financial Accounting
• Balance sheet
• Financial disclosures
• Current assets
• Accounting process
• Accounting equation
• Accounting processing cycle
• Stock issuance
• Estimating reserves
• Liquidating dividends
• Accounting changes
• Error corrections
• Accounting choices
• Theoretical structure
• Accrual accounting
• Financial accounting environment
• Accounting for leases
• Leasing environment
• Accounting by lessee
• Special accounting problems
• Cash versus accrual accounting
• International standard setting
• Accounting standards
• Accounting assists
• The challenges facing accounting
• Income taxes
• Accounting for income taxes
• Deferred tax liabilities
• Error analysis
• Accounting policy
• Accounting estimate
• Accounting policies
• Financial reporting
• Accounting information system
• Measurement issues
• Characteristics of accounting
• Capital allocation process