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84 Cards in this Set

  • Front
  • Back
Planning, recording, analyzing, and interpreting financial information
a planned process for providing financial information that will be useful to management
accounting system
organized summaries of a business's financial activities
accounting records
financial reports that summarize the financial condition and operations of a business
financial statements
a business that performs an activity for a fee
service business
a business owned by one person
anything of value that is owned
financial rights to the assets of a business
an amount owed by a buesiness
the amount remaining after the value of all liabilities is subtracted from the value of all assets
owner's equity
an equation showing the relationship among assets, liabilities, and owner's equity
accounting equation
the principles of right and wrong that guide an individual in making decisions
the use of ethics in making business decisions
business ethics
a business activity that changes assets, liabilities, or owner's equity
a record summarizing all the information pertaining to a single item in the accounting equation
the name given to an account
account title
the amount in an account
account balance
the account used to summarize the owner's equity in a business
an increase in owner's equity resulting from the operation of a business
a sale for which cash will be received at a later date
sale on account
a decrease in owner's equity resulting from the operation of a business
assets taken out of a business for the owner's personal use
an accounting device used to analyze transactions
T account
an amount recorded on the left side of a T account
an amount recorded on the right side of a t account
the side of the account that's increased
normal balance
a list of accounts used by a business
chart of accounts
a form for recording transactions in chronological order
recording transactions in a journal
a journal amount column headed with an account title
special amount column
a journal amount column thats not headed with an account title
general amount column
information for each transaction recorded in a journal
the recording of debit and credit parts of a transaction
double-entry accounting
a business paper from which information is obtained for a journal entry
source document
a business form ordering a bank to pay cash from a bank account
a form describing the goods or services sold, the quantity, and the price
an invoice used as a source document for recording a sale on account
sales invoice
a business form giving written acknowledgment for cash received
a form on which a brief message is written describing a transaction
determining that the amount of cash agrees with the accounting records
proving cash
a group of accounts
a ledger that contains all accounts needed to prepare financial statements
general ledger
the number assigned to an account
account number
the procedure for arranging accounts in a general ledger, assigning account numbers, and keeping records current
file maintenance
writing an account title and number on the heading of an account
opening an account
transferring information from a journal entry to a ledger account
a journal entry made to correct an error in a previous journal entry
correcting entry
a statement that guides the ethical behavior of a company and its employees
code of conduct
a bank account from which payments can be ordered by a depositor
checking account
a signature or stamp on the back of a check, transferring ownership
an endorsement consisting only of the endorser's signature
blank endorsement
an endorsement indicating a new owner of a check
special endorsement
an endorsement restricting further transfer of a check's ownership
restrictive endorsement
a check with a future date on it
postdated check
a report of deposits, withdrawals, and bank balances sent to a depositor by a bank
bank statement
a check that a bank refused to pay
dishonored check
a computerized cash payments system that transfers funds without the use of checks, currency, or other paper documents
electric funds transfer
a bank card that automatically deducts that amount of a purchase from the checking account of the cardholder
debit card
an amount of cash kept on hand and used for making small payments
petty cash
a form showing proof of a petty cash payment
petty cash slip
the length of time for which a business summarizes and reports financial information
fiscal period
a columnar accounting form used to summarize the general ledger information needed to prepare financial statements
work sheet
a proof of equality of debits and credits in a general ledger
trial balance
changes recorded on a work sheet to update general ledger accounts at the end of a fiscal period
a financial statement that reports assets, liabilities, and owner's equity on a specific date
balance sheet
a financial statement showing the revenue and expenses for a fiscal period
income statement
the difference between total revenue and total expenses when totale revenue is greater
net income
the difference between total revenue and total expenses when total expenses are greater
net loss
journal entries recorded to update general ledger accounts at the end of a fiscal period
adjusting entries
accounts used to accumulate information from one fiscal period to the next
permanent accounts
accounts used to accumulate information until its transferred to the owner's capital account
temporary account
journal entries used to prepare temporary accounts for a new fiscal period
closing entries
a trial balance prepared after the closing entries are posted
post-closing trial balance
the series of accounting activities included in recording financial information for a fiscal period
accounting cycle
language of business
keeping personal and business records separate is an application of
business entity
concept applied when business transactions are stated in numbers that have common values; using a common unit of measurement
Unit of Measurement
concept applied when revenue is recorded at the time goods or services are sold
Realization of Revenue
Concept applied when a source document is prepared for each transaction
objective evidence
Concept applied when the same accounting procedures are followed in the same way in each accounting period
consistent reporting
Concept applied when changes in financial information are reported for a specific period of time in the form of financial statements
accounting period cycle
Concept applied when revenue from business activities and expenses associated with earning that revenue are recorded in the same accounting period
matching expenses with revenue
concept applied when financial statements contain all information necessary to understand a business's financial condition
adequate disclosure
concept when financial statements are prepared with the expectation that a business will remain in operation indefinitely
going concern