Term
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Definition
| Financial statement showing the firms accounting value on a particular date. Snap shot of the firm at any given time: Assets, liability and stockholder’s equity. |
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Term
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Definition
| Indicates how a firms performs during a period time, cost of sales, operating expenses, income expenses and taxes and its all in order to arrive at the firms net income or earnings after taxes. (Revenue – Expenses= Earnings After Taxes) |
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Term
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Definition
| Indicates how the firm’s generates cash flow from its operations. How it uses its investing activities and how it obtains cash from financing activities. |
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Term
| Cash flow from Operations: |
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Definition
Net earnings
+depreciation
+increase in A/R
+ Increase in A/P
-inventory
=CF from Operating Activities |
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Term
| Cash Flow from Financing Activities: |
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Definition
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Term
| Cash flows from investing: |
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Definition
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Term
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Definition
Decrease in Asset account
Increase in Liability or Equity |
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Term
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Definition
Increase in Asset Account
Decrease in Liability or Equity |
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Term
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Definition
| Will be on the balance sheet for asset does not necessarily reflect the market value of the asset. (Original historical cost, adjusted through depreciation). Generally not what the assets is actually worth. GAAP show assets, carried on the books. |
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Term
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Definition
| Value of an asset should always be higher than the book value; important for valuing an asset use market value. Stock value. |
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Term
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Definition
Is equal to the firm’s market value of debt and equity less the firm’s holding of cash and cash securities. Done in a firm to figure out the overall capital structure of the firm and what the worth of the structure.
Cash minus cash substitutes marketable securities.
Depreciation:
Is a non-cash expense |
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Term
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Definition
| Applies to the next dollar of taxable income |
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