Revenues vs. Assets, Liabilities vs. Expenses first, something, material, question

wonderfuldream

I know this is a simple question but this is my first time coming across this material. Is there something that easily distinguishes the two from each other? I did horribly on the schweser end of section review where it lists assets, liabilities, revenues and expenses and has you classify the item. Thanks for your help

Daniel1985

Post, because this topic is new to you, you're going to have to spend extra time familiarizing yourself with the major financial statements: balance sheet, income statement and cash flow statement, each of which is a complement to the other.

Assets and liabilities are balance sheet items, while revenues and expenses appear on the income statement.

Review the material a few more times and come back with some more focused questions. If you're still struggling after a few more weeks, consider participating in a preparatory class or workshop to help bring you up to speed.

dece2011

for the LI test be sure you know the following

current assets- anything that will be used up or sold within one year or one operating cyle
for example, cash, accounts recievables, inventory

Current Liabilities-anything that must be paid or settled in cash within one year or one operating cycle
for example Accounts payable, current portion of long term debt

ajpheif16

thanks for the info

[cash collected=Revenue(what is reported on the income statement) - change in Accounts receivables(sales on credit) + change in deferred revenue(unearned revenue)]-Ako

I did not know this. that is all new to me. The prep class might be a good idea

Mechanic

well just look at what the formula is saying. i honestly dont think you need a prep class for LI. i passed it the first time with 330 hours of studying.

cchang

"The prep class might be a good idea"

Cosign.

If you don't know the difference from a balance sheet, IS, and statement of CF with two months left, you need to do some work.

Some serious work.

Good luck.

Flok

Have you tried reading the CFAI Text? I only ask because you mentioned Schweser. Schweser is a great tool for L1, but you might need to actually read the material as the CFAI presents it if you need help with this concept. If you don't learn the difference between Assets, Liabilities, Expenses and Revenues, you might as well accept your failure of FSA (and probably the exam...yes, it's that important).