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45 Cards in this Set

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The resources owned by a business.
assets
The rights of creditors that represent debts of the business.
liabilities
An organization in which basic resources (inputs), such as material and labor, are assembled and processed to provide goods or services (outputs) to customers.
business
A type of business that changes basic inputs into products that are sold to individual customers
manufacturing
A type of business that purchases products from other businesses and sells them to customers.
merchandizing
A business owned by one individual
proprietorship
A business owned by two or more individuals
partnership
A business organized under state or federal statutes as a separate legal entity.
corporation
An integrated set of plans and actions designed to enable the business to gain an advantage over its competitors and , in so doing, to maximize its profits.
business strategy
A strategy wherein a business designs and produces products or services of acceptable quality at a cost lower than that of its competitors
low-cost strategy
The way a business adds value for its customers by processing inputs into a product or service
value chain
A person or entity who has an interest in the economic performance of a business.
business stakeholder
Individuals authorized by the owners to operate the business
managers
An information system that provides reports to stakeholders about the economic activities and condition of a business.
accounting
Moral principles that guide the conduct of individuals
ethics
A specialized field of accounting concerned primarily with the recording and reporting of economic data and activities to stakeholders outside the business.
financial accounting
A specialized field of accounting that uses estimated data to aid management in running day-to-day operations and in planning future operations.
managerial accounting
The authoritative body that has the primary responsibility for developing accounting principles
Financial Accounting Standards Board (FASB)
A concept of accounting that limits the economic data in the accounting system to data related directly to the activities of the business.
business entity concept
A concept of accounting requiring that economic data be recorded in dollars
unit of measure concept
The rights of the owners
owner's equity
Assets = Liabilities + Owner's Equity
accounting equation
An economic event or condition that directly changes an entity's financial condition or directly affects its results of operations
business transaction
The liability created by a purchase on account
account payable
Items such as supplies that will be used in the business in the future
prepaid expenses
A claim against the customer
account receivable
The amounts used in the process of earning revenue
expenses
The amount a business earns by selling goods or services to its customers
revenue
A summary of the revenue and expenses for a specific period of time, such as a month or a year.
income statement
A summary of the changes in owner's equity that have occurred during a specific period of time, such as a month or a year
statement of owner's equity
A list of the assets, liabilities, and owner's equity as of a specific date, usually at the close of the last day of a month or a year
balance sheet
A summary of the cash receipts and cash payments for a specific period of time
statement of cash flows
A concept of accounting in which expenses are matched with the revenue generated during a period by those expenses
matching concept
The form of balance sheet that resembles the basic format of the accounting equation, with assets on the left side and the liabilities and owner's equity sections on the right side.
account form
The resources owned by a business are called ______.
assets
The rights of the owners are called _______ _______.
owner's equity
Assets = Liabilities + Owner's Equity is the ______
_________
accounting equation
The liability created by a purchase on account is referred to as a(n) ______ __________
account payable
If liabilities are $85,000 and owner's equity is $45,000, the amount of the assets is ___________.
$130,000
If assets are $375,000 and owner's equity is $295,000, the amount of the liabilities is ________.
$80,000
If total assets increased by $85,000 and liabilities decreased by $9,000 during the period, the amount and direction (increase or decrease) of the period's change in owner's equity was
__________.
$94,000 increase
A summary of the changes in the owner's equity that have occurred during a specific period of time is the
________ _____ ______ _____.
statement of owner's equity
If assets are $98,000 and liabilities are $32,500, the amount of owner's equity is
_________.
$65,500
If the owner's equity is $46,000 and liabilities are $34,000, the amount of assets is ________.
$80,000
A claim against the customer is called a(n)________.
account receivable