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[FINANCIAL STATEMENT ANALYSIS] CHAP 2: BALANCE SHEET (1), Depreciation…

- - - - Obligations as a result of past events that are expected to require an outflow of economic resources.
    - - The owners' residual interest in the assets after deducting the liabilities. ("Net assets")
    - - Resources controlled as a result of past transactions that are expected to provide future economic benefits.
- - - - Trading securities: Reported on BS at Fair value, Unrealized gains and losses are recognized in IS.
      - Available-for-sale securities: not expected to be held to maturity or traded in the near term. Reported on BS at Fair value, Unrealized gains and losses are recognized in Comprehensive income in S/Hs Equity.
    - - Reported at NRV, based on estimated Bad Debt Expense.
        - Bad Debt Expense increases Allowance for doubtful accounts (a contra-asset account)
  - - - IFRS: Cost model & Revaluation model;
        GAAP: Cost model
        
        Cost model: PP&E (NOT Land) is reported at Amortized cost (=Historical cost - Accumulated Depreciation, Amortization, Depletion, Impairment losses)
        
        Revaluation model: Reported at [Fair value - Accumulated Depreciation]
    - - Identifiable intangible asset
        
        Patents, Trademarks, Copyrights
        
        Cost model or Revaluation model
      - Unidentifiable intangible asset: Goodwill (Excess of purchase price over the fair value of identifiable net assets acquired in a business acquisition as some assets are not reported on BS)
- - - - Expenses that have been recognized in the IS but are not yet contractually due.
        
        Result from accrual method of accounting
    - - Cash collected in advance of providing goods and services