Accounting

Front 1

what are the goals of financial management

Back 1

solvency
efficiency
profitability

Front 2

process of collecting, recording, summarizing, and using financial data is the definition of?

Back 2

accounting

Front 3

the special area of accounting that deals with verifying the records that are kept and any computations that are made is called

Back 3

auditing

Front 4

the process that documents the flow of resources and claims of creditors and owners to the resources is the definition of?

Back 4

book keeping

Front 5

the fiscal/financial events that are recorded is called

Back 5

transactions

Front 6

the period of time over which transactions are recorded at the end of which income is measured is called?

Back 6

accounting period

Front 7

how long is are most common accounting periods?

Back 7

1 year

Front 8

what are the methods of recording transactions

Back 8

accrual
cash

Front 9

transactions that are recorded at the time they occur is the definition of

Back 9

accrual

Front 10

transactions recorded when cash transfers hands is

Back 10

cash

Front 11

the use of the accrual system because it matches revenue earned to expenses incurred to generate revenue is the definition of what principle

Back 11

matching principle

Front 12

The measurement of goods sold or services rendered for which the business receives “cash” or “the promise of cash” (or something else of value) is the definition of

Back 12

revenue

Front 13

The measurement of resources used up during a period of time in order to earn revenue is the definition of

Back 13

expenses

Front 14

what are the different types of accounts

Back 14

asset
liabilities
owner equity

Front 15

Resources owned by the business is the definition of

Back 15

assets

Front 16

cash
accounts receivable
building
inventory
prepaid insurance
equipment
are examples of what type of accounts

Back 16

assets

Front 17

Debts owed by the business to creditors is the definition of

Back 17

liabilities

Front 18

liabilities arise under what 2 conditions

Back 18

borrow cash (loans)
purchase goods on services on credit

Front 19

notes payable and accounts payable are examples of what type of account

Back 19

liability

Front 20

The claim of the owners to the assets of the business, after the creditors have been paid (also called NET WORTH) is the definition of

Back 20

owners equity

Front 21

contributed capital, sales revenue, service revenue, and expense account are examples of what type of account

Back 21

owner's equity

Front 22

Every time a transaction occurs, it has to be recorded in the proper accounts is the definition of

Back 22

dual effects of accounting

Front 23

the measure of resources used up that requires the immediate payment of cash for the amount in full is the definition of?

Back 23

expense

Front 24

for asset accounts, where do increases or decreases in accounts fall (debit or credit)

Back 24

increases = debit
decrease = credit

Front 25

for liability and OE account, where do increases or decreases in accounts fall (debit or credit)

Back 25

decreases = debit
increases = credit

Front 26

what are the 4 steps for recording transactions

Back 26

mental analysis
journalizing
posting
trial balance

Front 27

what are the steps used for recording typical transactions

Back 27

mental analysis
posting

Front 28

making sure the T balance equals out is the definition of?

Back 28

trial balance

Front 29

this occurs when the last day of the accounting period has not been reached

Back 29

unadjusted trial balance

Front 30

What are the 4 typical adjusting entries

Back 30

inventory
salary
depreciation
prepaid expenses

Front 31

Tangible, long-lived resources used in the operation of the business (Bldg, Machinery, Fixtures, Equipment) are what type of assets

Back 31

fixed

Front 32

Resources owned by the business which are expected to be realized in cash, sold, or consumed in one year (Cash, Accounts Receivable, Inventory) are what type of assets

Back 32

current

Front 33

True or False: With the exception of land, fixed assets are depreciated over their useful life

Back 33

True

Front 34

equal wear/tear each year of useful life
is what type of depreciation

Back 34

straight line

Front 35

This type of account reside directly below the fixed asset account to which they pertain.
for depreciating fixed assets, it should be used for the credit entry so that the balance in the fixed asset account will retain its initial value

Back 35

contra (offset) accounts

Front 36

What are the six sections of an income statement

Back 36

heading
revenue
cost of goods sold
gross margin
remaining expenses
net profit

Front 37

revenue - cost of goods sold equal?

Back 37

gross margin

Front 38

revenue - all expenses equal?

Back 38

net profit

Front 39

gross margin - remaining expenses equal

Back 39

net profit

Front 40

which of the following do not pay income tax?
corporations
sole proprietorships
partnerships

Back 40

sole proprietorships
partnerships

Front 41

net profit - income tax equal

Back 41

net income

Front 42

this is made after income is measures. It empties out revenue and expense accounts and transfer income to retain earnings ( OE account)

Back 42

closing entries

Front 43

Theses are made to empty out revenue and expense accounts so that the business can begin measuring income for the new accounting period

Back 43

closing entries

Front 44

This presents the financial position of a business at a particular point in time.

Back 44

balance sheet

Front 45

To construct a balance sheet, what accounts are needed?

Back 45

all assets
all liabilities
all OE accounts

Front 46

What are the 5 sections of the balance sheet

Back 46

heading
assets
liabilities
OE
liabilities + OE
retained earnings

Front 47

match the following to the time during the accounting period (throughout vs. last day) in which it must be done:

record transactions
adjust entries
income statment
closing entries
balance sheet

Back 47

record transactions = throughout accounting period
everything else = last day of accounting period