Accounting 201 Ch3

Front 1

Accrual accounting

Back 1

a form of accounting in which revenues are recognized when they are earned and expenses are recognized when they are incured

Front 2

accounts recievable

Back 2

an asset account that increases when goods are sold on credit

Front 3

unearned revenue

Back 3

a liability account that results when a company receives cash from a customer for goods or services to be provided in the future

Front 4

accrued revenue

Back 4

is revenue recognized prior to the receipt of cash

Front 5

Deferred revenue

Back 5

revenue recognized after cash has been received

Front 6

1.accrued expenses
2.deferred expenses

Back 6

1.result when expenses are recognized prior to the payment of cash
2. result when expenses are recognized after the payment of cash

Front 7

accounts payable

Back 7

is a liability account that identifies an obligation to pay suppliers in the near future

Front 8

prepaid expense

Back 8

an asset account that identifies a resource that has been paid for but not used

Front 9

matching principle

Back 9

requires companies to recognize the expenses used to generate revenue in the same accounting period in which the revenues are recognized

Front 10

adjusting entry

Back 10

a transaction recoreded in the accounting system to ensure the correct account balances are reported for a particular fiscal period

Front 11

depreciation

Back 11

the allocation of the cost of assets to the fiscal periods that benefit from the asset's use

Front 12

accumulated depreciation

Back 12

a contra asset account used to identify the total amount of depreciation recorded for a company's assets

Front 13

contra account

Back 13

an account that offsets another account

Front 14

journal

Back 14

a chronological record of a company's transactions

Front 15

ledger

Back 15

a file in which each of a company's accounts and the balances of thoes accounts are maintained

Front 16

posting

Back 16

the process of transfering transactions to the specific accounts in a company's ledger

Front 17

general ledger

Back 17

the primary ledger a company uses to record its account balances

Front 18

accounting cycle

Back 18

the process of recording,summarizing and reporting accounting information