Assignment

- Accounting equation
- Statement of changes in Retained Earnings

Identify elements; calculate missing amount (e.g., net income, etc.); calculate updated retained earnings amount from a Trial Balance

- Ratios (liquidity, profitability, solvency) o Interpret ratio

o Calculate ratio
o Examples:

• Dividend payout ratio
• Times interest earned
• Asset turnover
• Return on Assets
• Free cash flows
• Working capital
• Profit margin
• Earnings per share
• Debt to asset ratio

- Plant Assets:

o Characteristics
o Examples of plant assets
o Calculate Cost of Plant assets

• Land
• Truck
• Machine

- Depreciation:

o What is it?
o What is depreciable cost?
o Calculate amount of depreciation using straight-line method, double declining method, units of activity
o Change in estimate, calculate revised depreciation
o Disposal of asset, calculate gain or loss on disposal, entry for disposal of plant asset

- Intangible Assets:

o Characteristics
o Identify intangible assets
o Cost of intangible assets
o Research and development costs

- Liabilities

o Current liabilities

• Notes payable (journal entries to record issue and payment of note payable)

• Interest payable (calculate accrued interest, adjusting entry)

• Sales tax

• Payroll related liabilities (salary and wages, payroll (FICA) taxes)

• Unearned revenue

• Bonds payable (issue of bonds at face value, at discount, at premium)

• Calculate amount of annual interest on bonds

• Retirement of bonds

- Equity:

o Corporate form of organization
o Stocks

• Par value
• Authorized share
• Treasury stocks
• Common stock
• Preferred stock
• Outstanding shares o Issue of stocks for cash, non-cash asset (journal entries)

o Dividends

• Dividend in arrears
• Declaration date, date of record, payment date
• Calculate distribution of dividend to preferred and common shareholders o Stock dividend

o Stock split
o Calculate Total paid-in Capital
o Calculate total stockholders equity

- Statement of Cash flows:

o Identify Operating activities, calculate cash flow from operating activities (direct vs. indirect method)

o Identify Investing activities, calculate cash flow from investing activities o Identify Financing activities, calculate cash flow from financing activities.