Business Finance - Week 1

The Accounting Equation

• Assets = Liabilities + Owner's Equity

• Revenue - Expenses = Profit/Loss

• Revenues - Assets = Owner's Equity

• Revenues - Liabilities = Owner's Equity

What the company owns

• Assets

• Liabilities

Revenue - Expenses = Profit/Loss

• Balance Sheet

• Income Statement

• Statement of Cash Flows

• Has nothing to do with accounting

Revenue is also known as "profits"

• True

• False

An income statement closes out at the end of an accounting period

• True

• False

Food and beverage inventory

• Current Asset

• Current Liability

• Equity

• Fixed Asset

A hospitality company's most liquid asset

• Inventory

• Cash

• Employees

• Revenue

Money owed to a restaurant supplier within an accounting period

• Current Asset

• Current Liability

• Fixed Asset

• Long-Term Liability

GAAP

• Generally Accepted Asset Principle

• Given Assets and Profits

• Generally Accepted Accounting Principles

• Generally Accepted Accounting Profits