Use LEFT and RIGHT arrow keys to navigate between flashcards;
Use UP and DOWN arrow keys to flip the card;
H to show hint;
A reads text to speech;
16 Cards in this Set
- Front
- Back
Sole Proprietorship
|
Business organization owned by one person. The owner is personally liable for all debts of the business
|
|
Partnership
|
Business organization owned by two or more people. Each partner is personally liable for all debts of the business
|
|
Corporation
|
A separate entity from both a legal and accounting perspective. Owners of corporations (stockholders) are not personally responsible for debts of the corporation.
|
|
Accounting
|
A system of analyzing, recording, summarizing and reporting the results of a business's activities.
|
|
Separate Entity Assumption
|
Requires that a business's financial reports include only he activities of the business and not those of its stockholders.
|
|
Assets
|
Resources controlled by the company that have measurable value and are expected to provide future benefits to the company.
|
|
Liabilities
|
Amounts owed by the business to creditors
(notes payable: more formal, payed over a longer period of time) (accounts payable: purchasing on credit, 50 days to pay) |
|
Stockholders Equity
|
Owners' claim to the business resources
|
|
Dividends
|
Distributions of a company's earnings to its stockholders as a return on their investment.
|
|
Financial Statements (order of 4)
|
1. Income Statement (others rely on it)
2. Statement of Retained Earnings (if related earnings is $0, co. probably just opened 1st year) 3. Balance Sheet (shows health of company) 4. Statement of Cash Flows (Where CASH came from and where it went, operating activities, investing activities, financing activities. |
|
Income Statement
|
Reports the amount of revenues less expenses for a period of time
|
|
Statement of Retained Earnings
|
Reports the way that net income and the distribution of dividends affected the financial position of the company during the period.
|
|
Balance Sheet
|
reports the amount of assets, liabilities, and stockholders equity for a business at A POINT IN TIME
|
|
Statement of Cash Flows
|
Reports the operating, investing and financing activities that caused increases and decreases in cash during the period.
|
|
General Accepted Accounting Principles (GAAP)
|
Rules of accounting created by the Financial Accounting Standards Board for use in the United States
|
|
International Financial Reporting Standards (IFRS)
|
Rules of accounting created by the International Accounting Standards Board for international use.
|