Intermediate Accounting I

Front 1

Assets

Back 1

Probable future economic benefits obtained or controlled by a particular entity as a result of past transactions or events.

Front 2

Comparability

Back 2

Ability to compare accounting information of different companies because they measure and report information in a similar manner.

Front 3

Comprehensive Income

Back 3

Change in equity (net assets) of an entity during a period from transactions and other events and circumstances from nonowner sources.

Front 4

Conceptual Framework

Back 4

A coherent system of interrelated objectives and fundamentals that can lead to consistent standards.

Front 5

Censervatism

Back 5

The approach of choosing an accounting method when in doubt that will least likely overstate assets and net income.

Front 6

Consistency

Back 6

An entity applies the same accounting treatment to similar events from period to period.

Front 7

Cost-Benefit Relationship

Back 7

The constraint that states that information should be provided only if the benefits of providing such information outweigh the costs of providing it.

Front 8

Economic entity assumption

Back 8

An assumption that states economic activity can be identified with a particular unit of accountability.

Front 9

Expense Recognition Principle

Back 9

The recognition of expenses is related to net changes in assets and earning revenues.

Front 10

Equity

Back 10

Residual interest in the assets of an entity that remains after deducting its liabilities.

Front 11

Expenses

Back 11

Outflows or other using up of assets or incurrences of liabilities (or a combination of both) during a period from delivering or producing goods, rendering services, or other activities that constitute the entity's ongoing major or central operations.

Front 12

Feedback Value

Back 12

Information that confirms or corrects prior expectations.

Front 13

Full Disclosure Principle

Back 13

The principle that information should be provided if it is of sufficient importance to influence the judgment and decisions of an informed user.

Front 14

Gains

Back 14

Increases in equity from peripheral or incidental transactions of an entity and from other transactions and other events and circumstances affecting the entity during a period except those that result from revenues or investments by owners.

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Going Concern Assumption

Back 15

An assumption that states an enterprise will continue to operation long enough to carry out its existing objectives and commitments.

Front 16

Historical cost principle

Back 16

An accounting principle that states that assets and liabilities should be recorded at their acquisition price.

Front 17

Industry Practices

Back 17

The constraint that requires a departure from basic accounting theory because of the peculiar nature of some industries and business concerns.

Front 18

Liabilities

Back 18

Probable future sacrifices of economic benefits arising from present obligations of a particular entity to transfer assets or provide services to other entities in the future as a result of past transactions or events.

Front 19

Losses

Back 19

Decreases in equity from peripheral or incidental transactions of an entity and from all other transactions and other events and circumstances affecting the entity during a period except those that result from expenses or distributions to owners.

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Matching Principle

Back 20

The principle that states that efforts (expenses) be matched with accomplishments (revenues).

Front 21

Materiality

Back 21

The constraint of determining if an item is important enough to likely influence the decision of a reasonably prudent investor or creditor.

Front 22

Measurement Principle

Back 22

A "mixed attribute" system that permits the use of various measurement bases.

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Monetary Unit Assumption

Back 23

An assumption stating that only transaction data that can be expressed in terms of money be included in the accounting records of the economic entity.

Front 24

Neutrality

Back 24

Information cannot be selected to favor one set of interested parties over another.

Front 25

Periodicity Assumption

Back 25

An assumption stating that the economic activities of an enterprise can be divided into artificial time periods.

Front 26

Predictive Value

Back 26

Information that helps users make predictions about the ultimate outcome of past, present, and future events.

Front 27

Qualitative Characteristics

Back 27

Characteristics that make accounting information useful.

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Relevance

Back 28

Information capable of making a difference in a decision.

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Reliability

Back 29

The extent that information is verifiable, is a faithful representation, an dis reasonably free of error and bias.

Front 30

Representational Faithfulness

Back 30

The numbers and descriptions represent what really existed or happened.

Front 31

Revenue Recognition Principle

Back 31

The principle that revenue be recognized when realized or realizable and earned.

Front 32

Revenues

Back 32

Inflows or outher enhancements of assets of an entity or settlement of its liabilities (or a combination of both) durin ga period from delivering or producing goods, rendering services, or other activities that constitute the entity's ongoing major or central operations.

Front 33

Understandability

Back 33

Informed users perceive the significance of information.

Front 34

Verifiability

Back 34

the ability to have information confirmed by independent persons.

Front 35

Account

Back 35

A systematic arrangement that shows the effect of transactions and other events on a specific asset, liability or equity.

Front 36

Accrued Expenses

Back 36

Expenses incurred but not yet paid.

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Accrued Revenue

Back 37

Revenues earned but not yet received.

Front 38

Adjusted Trial Balance

Back 38

A trial balance prepared immediately after all adjustments have been posted.

Front 39

Adjusting entries

Back 39

Entries made at the end of an accounting period to bring all accounts up to date on an accrual accounting basis.

Front 40

Balance Sheet

Back 40

The financial statement that shows the financial condition of the enterprise at the end of the period.

Front 41

Closing Entries

Back 41

The formal process by which all nominal accounts are reduced to zero and the net income or net loss is determined and transferred to the owners' equity account.

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Credit

Back 42

The right side of an account.

Front 43

Debit

Back 43

The left side of an account.

Front 44

Double-Entry System

Back 44

A system that records the dual effect of each transaction in its appropriate account.

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Event

Back 45

A happening of consequence.

Front 46

External Event

Back 46

a transaction between an entity and its environment.

Front 47

Financial Statements

Back 47

Statements that reflect the collection, tabulation, and final summarization of the accounting data.

Front 48

General Ledger

Back 48

A collection of all the asset, liability, owners' equity, revenue, and expense accounts.

Front 49

Income Statement

Back 49

The financial statement which measures the results of operations during the period.

Front 50

Internal Event

Back 50

A transaction that occurs within an entity.

Front 51

Journal

Back 51

The book of original entry where transactions and selected other events are initially recorded.

Front 52

Ledger

Back 52

The book containing the accounts.

Front 53

Nominal Accounts

Back 53

Nominal (temporary) accounts are revenue, expense and dividend accounts; except for dividends, they appear on the income statement.

Front 54

Post-Closing Trial Balance

Back 54

A trial balance prepared immediately after closing entries have been posted.

Front 55

Posting

Back 55

The process of transferring the essential facts and figures from the book of original entry (journal) to the ledger accounts.

Front 56

Prepaid Expense

Back 56

An item paid and recorded in advance of its use or comsumption, part of it properly represents expense of the current period and part represents and asset on hand at the end of a period.

Front 57

Real Accounts

Back 57

Real (permanent accounts) are asset, liability, and equity accounts and they appear on the balance sheet.

Front 58

Reversing Entries*

Back 58

Entries at the beginning of the next accounting period that are the exact opposite of the adjusting entries made in the previous period.

Front 59

Statement of Cash Flows

Back 59

The financial statement which measures the cash provided and used by operating, investing, and financing activities during the period.

Front 60

Statement of Retained Earnings

Back 60

The financial statement which reconciles the balance of the retained earnings account from the beginning to the end of the period.

Front 61

Journal

Back 61

The book of original entry where transactions and selected other events are initially recorded.

Front 62

Ledger

Back 62

The book containing the accounts.

Front 63

Nominal Accounts

Back 63

Nominal (temporary) accounts are revenue, expense and dividend accounts; except for dividends, they appear on the income statement.

Front 64

Post-Closing Trial Balance

Back 64

A trial balance prepared immediately after closing entries have been posted.

Front 65

Posting

Back 65

The process of transferring the essential facts and figures from the book of original entry (journal) to the ledger accounts.

Front 66

Prepaid Expense

Back 66

An item paid and recorded in advance of its use or comsumption, part of it properly represents expense of the current period and part represents and asset on hand at the end of a period.

Front 67

Real Accounts

Back 67

Real (permanent accounts) are asset, liability, and equity accounts and they appear on the balance sheet.

Front 68

Reversing Entries*

Back 68

Entries at the beginning of the next accounting period that are the exact opposite of the adjusting entries made in the previous period.

Front 69

Statement of Cash Flows

Back 69

The financial statement which measures the cash provided and used by operating, investing, and financing activities during the period.

Front 70

Statement of Retained Earnings

Back 70

The financial statement which reconciles the balance of the retained earnings account from the beginning to the end of the period.

Front 71

Journal

Back 71

The book of original entry where transactions and selected other events are initially recorded.

Front 72

Ledger

Back 72

The book containing the accounts.

Front 73

Nominal Accounts

Back 73

Nominal (temporary) accounts are revenue, expense and dividend accounts; except for dividends, they appear on the income statement.

Front 74

Post-Closing Trial Balance

Back 74

A trial balance prepared immediately after closing entries have been posted.

Front 75

Posting

Back 75

The process of transferring the essential facts and figures from the book of original entry (journal) to the ledger accounts.

Front 76

Prepaid Expense

Back 76

An item paid and recorded in advance of its use or comsumption, part of it properly represents expense of the current period and part represents and asset on hand at the end of a period.

Front 77

Real Accounts

Back 77

Real (permanent accounts) are asset, liability, and equity accounts and they appear on the balance sheet.

Front 78

Reversing Entries*

Back 78

Entries at the beginning of the next accounting period that are the exact opposite of the adjusting entries made in the previous period.

Front 79

Statement of Cash Flows

Back 79

The financial statement which measures the cash provided and used by operating, investing, and financing activities during the period.

Front 80

Statement of Retained Earnings

Back 80

The financial statement which reconciles the balance of the retained earnings account from the beginning to the end of the period.