Packet A

Front 1

What is accounting the language of?

Back 1

Bussines

Front 2

What are the 3 ways businesses make money?

Back 2

Provide a service, sell products, or both

Front 3

How is a bussines owned

Back 3

Single proprietorship, partnership, corporation

Front 4

What are the 3 financial statements

Back 4

Income statement, statement of retained earnings, balance sheet

Front 5

Single proprietorship

Back 5

Owned by one person

Front 6

Partnership

Back 6

2 or more people are owners

Front 7

Corporation

Back 7

A single legal being created in the law

Front 8

Corporation advantages

Back 8

Limited liability. Meaning bussines and corporation can be sued but not the owner (LLC)

Front 9

Single proprietorship advantages

Back 9

Easy to start, bussines pays no income tax

Front 10

Single proprietorship disadvantage

Back 10

Unlimited liability

Front 11

Partnership advantage

Back 11

Bussines pays no income tax, you can pull resources

Front 12

Partnership disadvantage

Back 12

Unlimited liability

Front 13

Corporation disadvantages

Back 13

Pays fees to start up and annual fees, has to file with state, double taxation

Front 14

How do you communicate financial information about a company?

Back 14

With financial statements

Front 15

What does an income statement tell you?

Back 15

How much profit a company made within a year

Front 16

What is a balance sheet?

Back 16

It tells you the financial condition of a company. Also known as statement of financial condition/position

Front 17

Assests

Back 17

Everything a company owns

Front 18

Liability

Back 18

Debt a company may have

Front 19

What is the accounting equation?

Back 19

Assests = Liability + Networth

Front 20

IPO

Back 20

Initial public offering

Front 21

Liquidate

Back 21

A company decides to go out of business,voluntarily or invitatory. They sell all assets and pay off liability’s,owners get whatever is left

Front 22

Networth

Back 22

The owners share of the company.whatever is left after the company liquidates

Front 23

Equity

Back 23

Share of

Front 24

Mortgage

Back 24

Money borrowed from the bank

Front 25

What are the 2 ways to get equity

Back 25

Invest and profit

Front 26

Capitolstock

Back 26

How much owner invested

Front 27

How does a company make profit?

Back 27

If they take more money ey than they put in

Front 28

Stockholders

Back 28

Owners of a corporation

Front 29

Dividen

Back 29

The profit is given to the owner

Front 30

Retained earnings

Back 30

A profit a company made that's has not been given to the owner YET

Front 31

Accounts receivable

Back 31

Money owed to the company from their customers

Front 32

Note

Back 32

A legal document

Front 33

Note receivable

Back 33

Money owed to the company through a legal document

Front 34

Accounts payable

Back 34

Money the company owes to the supplier

Front 35

Notes payable

Back 35

Money owed signed by a legal document

Front 36

Purchase

Back 36

Total amount of merchandise bought

Front 37

purchase return

Back 37

Merchandise that was returned

Front 38

Net purchase

Back 38

Amount of money spent on merchandise that was kept

Front 39

Sales discount

Back 39

Amount of money a customer saves

Front 40

Sales Return

Back 40

Merchandise customer send back

Front 41

Net sales

Back 41

Amount of money we collected on the merchandise the customer kept

Front 42

net purchase

Back 42

Amount of money spent on merchandise we kept

Front 43

Three steps to finding ending inventory

Back 43

1. Count merchandise

2. Determine cost

3. Apply lower of cost or Market rule

Front 44

Gross profit

Back 44

Total revenue minus the cost of goods sold