Accounting Semester 1 Vocab And Concepts

Front 1

accounting equation

Back 1

an equation showing the relationship among assets, liabilities, and owner's equity

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accounting period cycle

Back 2

concept- changes in financial information are reported for a specific period of time in the form of financial statements

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adequate disclosure

Back 3

concept- financial statements contain all information necessary to understand a business's financial condition

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adjusting entries

Back 4

journal entries recorded to update general ledger accounts at the end of a fiscal period

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balance sheet

Back 5

a financial statement that reports assets, liabilities, and owner's equity on a specific date

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business entity

Back 6

concept- financial information is recorded and reported separately from the owner's personal financial information

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chart of accounts

Back 7

a list of accounts used by a business

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closing entries

Back 8

journal entries used to prepare temporary accounts for a new fiscal period

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consistent reporting

Back 9

concept- the same accounting procedures are followed in the same way in each accounting period

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Going concern

Back 10

concept- financial statements are prepared without the expectations that a business will remain in operation indefinitely

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Historical cost

Back 11

concept- the actual amount paid for merchandise or other items bought is recorded

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Matching expenses with revenue

Back 12

concept- revenue form business activities and expenses associated with earning that revenue are recorded in the same accounting period

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Objective evidence

Back 13

concept- a source document is prepared for each transaction

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Post-closing trial balance

Back 14

a trill balance prepared after the closing entries are posted

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posting

Back 15

transferring information from a journal entry to a ledger account

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proprietorship

Back 16

a business owned by one person

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realization of revenue

Back 17

concept- revenue is recorded at the time goods or serves are sold

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revenue

Back 18

an increase in owner's equity resulting form the operation of a business

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service business

Back 19

a business that performs an activity for a fee

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source document

Back 20

a business paper from which information is obtained for a journal entry

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T account

Back 21

an accounting device used to analyze transactions

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temporary accounts

Back 22

accounts used to accumulate information until it is transferred to the owner's capital account

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trial balance

Back 23

a proof of the equality of debits and credits in a general ledger

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Unit of Measurement

Back 24

concept- business transactions are stated in numbers that have common values

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work sheet

Back 25

a columnar accounting form used to summarize the general ledger information needed to prepare financial statements