Fnc1 Study Cards

Front 1

A transaction that increases Liabilities and Equity at the same time.

Back 1

Is not possible

Front 2

Identifying Transactions, Recording transactions, and communication transactions should be performed in what order?

Back 2

Identifying, recording, and communicating

Front 3

The proper order for these transactions are Identifying, recording, and communication

Back 3

True

Front 4

Who is an external user of accounting information

Back 4

Company Customers

Front 5

Internal users of accounting information are

Back 5

Sales staff, officers and directors, budget officers

Front 6

Managers and internal users of accounting information

Back 6

Service , Research and development , Production ,Human resource

Front 7

This person is a manager but is not an internal user of accounting information

Back 7

Partner in a CPA firm charged with conduction the company's external audit.

Front 8

The Cost principle

Back 8

accounting information based on actual cost. Does not take into consideration the actual value of the asset, it only records the actual cost paid for the asset

Front 9

The going-concept principle

Back 9

something that remains in operation in the foreseeable future

Front 10

The business entity principle

Back 10

requires that a business to be accounted for separately from its owners and any other entity.

Front 11

The monetary unit principle

Back 11

transactions and events can be expressed in money units

Front 12

Note payable

Back 12

liability expresses written promise to pay a definite sum of money on demand or on a specific future date

Front 13

Note receivable

Back 13

Asset consisting of a written promise to receive a definite sum of money on demand or on a specific future date

Front 14

No-par value stock

Back 14

Stock class that has not been assigned a par (or stated) value by the corporate charter

Front 15

Conservatism Principle

Back 15

less optimistic estimate when two estimates are about equally likely

Front 16

less optimistic estimate when two estimates are about equally likely

Back 16

The Equity term

Front 17

increase in Expenses will decrease equity

Back 17

True

Front 18

Owners withdrawals will decrease equity

Back 18

True

Front 19

What is the relationship between net income/loss and the balance in owners equity

Back 19

Net loss - beginning owners equity to calculate ending owners equity AND Net income + beginner owners equity will calculat ending owners equity

Front 20

Basic Accounting Equation

Back 20

Assets = liabilities + Owners Equity

Front 21

What Financial Statement refers to a specific period of time

Back 21

Balance Sheet

Front 22

Total Assets and Total Liabilities are reported on this statement

Back 22

Balance Sheet

Front 23

Statement of Cash flows represents what activities

Back 23

Operating, Financing, Investing

Front 24

When equity is subtracted from total assets the amount remaining is known as

Back 24

Total Liabilities

Front 25

Going - concern

Back 25

A business has an indefinite life span

Front 26

Business entity

Back 26

A business is distinct from its owners

Front 27

Cost principle

Back 27

assets should be recorded at cost, not appraised value

Front 28

Revenue Recognition Principle

Back 28

Revenues are recorded when earned

Front 29

Objectivity Principle

Back 29

Independent, Unbiased evidence should be used

Front 30

When cash is recieved from a customer in payment for an account receivable, how are the elements of the accounting equation effected

Back 30

Increase assets (cash) and decrease assets (ar)

Front 31

What happens when an owner invests more money into a company

Back 31

Increase in cash and an increase in equity

Front 32

When you purchase equipment on account what happens to the components of the accounting eqyation

Back 32

Increase in equipment and increase in liabilities

Front 33

Any users of a company's financial statement is considered an outside user

Back 33

TRUE

Front 34

To Walmart, bank loan officer, corporation shareholders,and the IRS are all examples of internal users of Walmart's financial statements

Back 34

FALSE

Front 35

What does CPA stand for

Back 35

Certified Public Accountant

Front 36

What does CMA stand for

Back 36

Certified Management Accountant

Front 37

What does CIA

Back 37

Certified Internal Auditor

Front 38

What are they main groups that establish GAAP

Back 38

FASB, SEC

Front 39

Informs the accountant that financial transactions completed by the entity should be recorded at the cost or actual amounts involved in the transaction and not some other measure such as liquidation values

Back 39

Historical Cost Principle

Front 40

Sole Proprietorship

Back 40

Separate accounting entity but it is not a separate legal entity

Front 41

Corporation

Back 41

Responsible for its own acts,, and its own debts, and may hold property in its own name rather than the names of it shareholders

Front 42

The basic accounting equation

Back 42

Assets - Liabilities = equity

Front 43

Business Entity

Back 43

based on the notion that transactions and events should be measured and recorded from the vantage point of the business entity itself and not from the vantage point of its owners.

Front 44

Excess of revenues over profit is called

Back 44

Net profit

Front 45

Statement of Cash flows

Back 45

A statement that shows where a company's cash comes from (receipts) and where it went (payments) during a period of time

Front 46

Financial Accounting

Back 46

Accounting aimed at serving external users

Front 47

Managerial Accounting

Back 47

is the area of accounting aimed at serving the decision making needs of internal users

Front 48

Bank loan officer is

Back 48

an external user

Front 49

Company president, and company's controllers are

Back 49

Internal users

Front 50

Balance sheet

Back 50

reports all assets, all liabilities, and owners equity for a particular date

Front 51

money owed to an outside entity

Back 51

Liabilities

Front 52

a company's debts

Back 52

Liabilities

Front 53

Owners claims to an organizations assets are called

Back 53

Owner's Equity or Owner's Capital

Front 54

Partnership

Back 54

Does not issue stock and cant not have shareholders

Front 55

Bookkeeping

Back 55

The part of accounting that involves recording economic transactions and events, either electronically or manually

Front 56

What does assets include

Back 56

land, buildings, equipment, inventories, supplies, cash, all investments

Front 57

What two statements report net income

Back 57

Income statement and Statement of Owners Equity

Front 58

Purpose of a financial audit

Back 58

is to determine whether the financial statements fairly reflect the company's financial position and operating results in accordance with GAAP and to add credibility to the information in the statements

Front 59

Return on investment is calculated how?

Back 59

Dividing net income for the period by the average total assets of the period

Front 60

What are expenses?

Back 60

an outflow of assets as a result of the major or central operations of a business. In some instances, expenses may result in increases in Liabilities.