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TOPIC D – posted Saturday
(1) Check out this format of the Balance Sheet using international accounting standards. What differences in classifications, from US rules, do you notice? Looks like non-current assets are listed first. Why do you think that is?
(2) One of the best solvency ratio is times-interest-earned. Calculate the ratio and interpret the results in these income statements.
(3) Why do you think accounts receivable can be sold to a third party (called
factoring)? What is management trying to do when they sell the receivables at the time of sale? Can cash discounts speed-up the cash conversion cycle? How so?
TOPIC C – posted Thursday
Journal entries are the way that accountants record business transactions. Using the debit/credit rules, prepare journal entries for these transactions: