📅 Tuesday, April 30th, 2024
A poem begins in delight and ends in wisdom.
— Robert Frost
MGT011A Lecture:
- single-step income statement: simple, net income = sum of revenues - sum of expenses
- multi-step income statement
- categorizes different revenues and expenses
- like classified balance sheet, provides more information for investors
- sections
- operating section (operation only)
- non-operating section (financing, investing)
- service company
- service revenue - total operating expenses = income from operations
- income from operations +/- other income and expenses, net. = pretax income
- merchandising company
- net sales - cost of goods sold = gross profit
- gross profit - total operating expenses = income from operations
- income from operations +- other income and expenses, net. = pretax income
- measures of company performance
- gross profit on sales
- income from operations
- income before income taxes
- net income
- impact of missing adjusting journal entries
- consider
- What accounts would the adjusting entry affect if journaled?
- Now, without the adjusting entry, would each account be overstated or understated?
- consider