This course continues the introduction to the content and concepts underlying basic financial statements. Major content includes income measurement, accrual accounting, accounting theory, time-value of money, accounting for current and long-term liabilities, owner's equity for sole proprietorships, partnerships and corporations, statement of cash flows and financial statement analysis.
- Contrast the accrual vs. cash basis of accounting.
- Explain generally accepted accounting principles.
- Identify constraints and assumptions used by accountants in financial reporting.
- Use present and future value tables for time-value of money calculations.
- Classify liabilities as current or long-term.
- Analyze bonds issued by companies.
- Compare owner's equity section of the balance sheet for proprietorships, partnerships, and corporations.
- Differentiate between various types of stock.
- Compute earnings per share and price earnings ratio and explain their meanings.
- Explain the purpose of the statement of cash flows and how it compares with the income statement.
- Use ratio analysis to determine a firm's liquidity, profitability, and solvency.