Accounting Test 1

Front 1

principle saying that assets should be recorded at their cost

Back 1

cost principle

Front 2

b/s accounts whose balances are carried forward to the next accounting period

Back 2

permanent accounts

Front 3

resources owned by a business

Back 3

assets

Front 4

average time required to go from cash to cash in producing revenues

Back 4

operating cycle

Front 5

system that identifies, records, and communicates the economic events of an organization to interested users

Back 5

accounting

Front 6

resources not expected to be realized in cash within the next year or operating cycle

Back 6

long-term investments

Front 7

noncurrent resources that do not have physical substance

Back 7

intangible assets

Front 8

obligations reasonably expected to be paid from existing current assets or through the creation of other current liabilities within the next year or operating cycle

Back 8

current liabilities

Front 9

entries to correct errors made in recording transactions

Back 9

correcting entries

Front 10

b/s that contains a number of standard classifications or sections

Back 10

classified balance sheet

Front 11

obligations expected to be paid after one year

Back 11

long-term liabilities

Front 12

ability of a company to pay obligations that are expected to become due within the next year or operating cycle

Back 12

liquidity

Front 13

expenses incurred but not yet paid in cash or recorded

Back 13

accrued expenses

Front 14

revenues earned but not yet received in cash or recorded

Back 14

accrued revenues

Front 15

list of accounts and their balances after all adjustments have been made

Back 15

adjusted trial balance

Front 16

entries made at the end of an accounting period to ensure that the revenue recognition and matching principles are followed

Back 16

adjusting entries

Front 17

difference between cost of depreciable asset and its related accumulated depreciation

Back 17

book value

Front 18

ccting period that exteds from jan 1 to dec 31

Back 18

calendar year

Front 19

accting basis in which revenue is recorded when cash is received and an expense is recorded when cash is paid

Back 19

cash basis accting

Front 20

acct that is offset against an asset acct on the balance sheet

Back 20

contra asset acct.

Front 21

allocation of the cost of an asset to expense over its useful life in a rational and systematic manner

Back 21

depreciation

Front 22

accting period that is one year in length

Back 22

fiscal year

Front 23

expenses paid in cash and recorded as assets before they are used or consumed

Back 23

prepaid expenses

Front 24

length of service of a productive facility

Back 24

useful life

Front 25

monthly or quarterly accounting time periods

Back 25

interim periods

Front 26

cash received and recorded as liabilities before revenue is earned

Back 26

unearned revenues

Front 27

temp acct used in closing revenue and expense accts

Back 27

income summary

Front 28

financial statement that reports the assets, liabilities, and stockholder's equity at a specific date

Back 28

b/s

Front 29

list of perm. accts and their balances after closing entries have been journalized and posted

Back 29

post-closing trial balance

Front 30

assets=liabilities+s/e

Back 30

basic accting exn

Front 31

assets of a relatively perm. nature that are being used in the business and not intended for sale. (fixed)

Back 31

property, plant, and equipment

Front 32

part of accting that involves only the recording of economic events

Back 32

bookkeeping

Front 33

revenue, expense, and dividends accts whose balances are transferred to retained earnings at the end of an accting period

Back 33

temporary accts.

Front 34

business organized as a separate legal entity under state corporation law having ownership divided into transferable shares of stock

Back 34

corporation

Front 35

distribution by a corporation to its stockholders on a pro rata basis

Back 35

dividend

Front 36

assumption that requires activities of the entity be kept separate and distinct from the activities of its owners and all other economic entities

Back 36

economic entity assumption

Front 37

standards of conduct by which one's actions are judged as right or wrong, honest or dishonest, fair or not fair.

Back 37

ethics

Front 38

cash and other resources that are reasonably expected to be realized in cash or sold or consumed withing one year or the operating cycle

Back 38

current assets

Front 39

accouting basis in which transactions that change a company's financial statements are recorded in the periods in which the events occur

Back 39

accrual basis accting

Front 40

entries made at the end of an accting period to transfer the balances of temporary accts to a permanent s/e equity acct, r/e

Back 40

closing entries