Wall Street Crash Course GAAP - ANSWER-

Wall Street Crash Course GAAP - ANSWER-Generally Accepted Accounting Principles IFRS - ANSWER-International Financial Reporting Standards (100+ Countries, not US) SEC - ANSWER-Securities and Exchange Comission FASB - ANSWER-Financial Accounting Standards Board (creates GAAP) Accounting Assumptions - ANSWER-1. Going Concern 2. Monetary Unit 3. Time period 4. Business entity Accounting Principles - ANSWER-1. Historical Costs - assets value reported as purchased price 2. Revenue Recognition - report revenue when it is earned and measurable 3. Matching Principle - associated costs recorded in the same time period 4. Full Disclosure - give all relevant financial information Accounting Constraints - ANSWER-1. Estimates - information must be estimated conservatively if uncertain 2. Materiality - only report relevant information 3. Consistency - use same rules across periods 4. Conservatism - overestimate costs, underestimate profits Form 10-K - ANSWER-Annual SEC accounting report Form 10-Q - ANSWER-Quarterly SEC accounting report (not audited like 10-K, less detailed) Form 8-K - ANSWER-Reports significant business events unreported in quarterly reports like an aquisition Form 14A - ANSWER-Proxy Statement - Informs shareholders before a vote S-4 - ANSWER-Merger or Reorganization form Income Statement - ANSWER-A financial statement showing the revenue and expenses for a fiscal period EBITDA - ANSWER-Earnings before interest, taxes, depreciation, and amortization Revenue - ANSWER-Sale of goods/services - excludes legal or interest payments - excludes receiving cash in accrual accounting - recorded after product is shipped - divided for product bundles and accounted separately Percentage of Completion Method - ANSWER-Revenue is recognized on the percentage of the total work/contract completed during the accounting period Completed Contract Method - ANSWER-Only recognize revenue after contract is completed Matching Principle - ANSWER-Expenses recognized in the same period as revenue COGs - ANSWER-Direct costs of manufacturing inventory: materials, labor, factory overhead (from maintenance to factory supervisors), shipping, depreciation - Only recognized when revenue received