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18 Cards in this Set
- Front
- Back
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Accrual-basis accounting
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Accounting basis in which transactions that change a company's finnancial statements are recorded in the periods in which the events occur
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Accrued expenses
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Expenses incurred but not yet paid in cash or recorded
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Accrued revenues
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REvenues earned but not yet received in cash or recorded
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Adjusted trial balance
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A list of accounts and their balances after all adjustments have been made
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Adjusting entries
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Entries made at the end of an accounting period to ensure that the revenue recognition and matching principles are followed
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Book value
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The difference between the cost of a depreciable asset and its related accumulated depreciation
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Calendar year
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An accounting period that extends from January 1 to December 31
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Cash-basis accounting
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Accounting basis in which revenue is recorded when cash is received and an expense is recorded when cash is paid
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Contra-asset account
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An account that is offset against an asset account on the balance sheet
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Depreciation
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The allocation of the cost of an asset to expense over its useful life in a rational and systematic manner
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Fiscal Year
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An accounting period that is one year in length
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Interim Periods
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Monthy or quarterly accounting time periods
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Matching principle
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The principle that efforts (expenses) be matched with accomplishments (revenues)
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Revenue recognition principle
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The principle that revenue be recognized in the accounting period in which it is earned
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Time period assumption
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An assumption that the economic life of a business can be divided into artificial time periods
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Prepaid expenses
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Expenses paid in cash and recorded as assets before they are used or consumed
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Unearned revenues
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Cash received and recorded as liabilities before revenue is earned
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Useful Life
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The length of service of a productive facility
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