![]() ![]() This company is a small retail store that makes and sells a variety of gourmet popcorn treats. Let’s use as an example a fictitious company named Cheesy Chuck’s Classic Corn. We have all of the ingredients (elements of the financial statements) ready, so let’s now return to the financial statements themselves. Now it is time to bake the cake (i.e., prepare the financial statements). While further discussion of comprehensive income is reserved for intermediate and advanced studies in accounting, it is worth noting that comprehensive income has four components, focusing on activities related to foreign currency, derivatives, investments, and pensions.įinancial Statements for a Sample Company Comprehensive income-defined as the “change in equity of a business enterprise during a period from transactions and other events and circumstances from nonowner sources” (SFAC No.Distribution to owners-cash, other assets, or ownership interest (equity) provided to owners.Investment by owners-cash or other assets provided to the organization in exchange for an ownership interest.Equity-the net worth (or net assets) of the organization.Liabilities-amounts the organization owes to others (also called creditors).Assets-items the organization owns, controls, or has a claim to.Losses-losses are similar to expenses but related to “incidental or peripheral” activities of the organization.Gains-gains are similar to revenue but relate to “incidental or peripheral” activities of the organization. ![]()
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