Study your flashcards anywhere!

Download the official Cram app for free >

  • Shuffle
    Toggle On
    Toggle Off
  • Alphabetize
    Toggle On
    Toggle Off
  • Front First
    Toggle On
    Toggle Off
  • Both Sides
    Toggle On
    Toggle Off
  • Read
    Toggle On
    Toggle Off
Reading...
Front

How to study your flashcards.

Right/Left arrow keys: Navigate between flashcards.right arrow keyleft arrow key

Up/Down arrow keys: Flip the card between the front and back.down keyup key

H key: Show hint (3rd side).h key

A key: Read text to speech.a key

image

Play button

image

Play button

image

Progress

1/7

Click to flip

7 Cards in this Set

  • Front
  • Back
Define the accounting cycle.
the sequence of steps followed in the accounting system to measure business transactions and transform them into financial statements; it includes analyzing and recording transactions, posting entries, adjusting and closing the accounts, and preparing financial statements.
Define closing entries.
entries made at the end of an accounting period that set the stage for the next accounting period by clearing the temporary accounts of their balances and transferring them to owner's capital; they summarize a period's revenues and expenses.
Define crossfooting.
adding and subtracting numbers across a row.
Define Income summary.
a temporary account used during the closing process that holds a summary of all revenues and expenses before the net income or loss is transferred to the owner's capital account.
Define permanent accounts.
balance sheet accounts; accounts whose balances can extend past the end of an accounting period. also called real accounts.
Define post-closing trial balance.
a trial balance prepared at the end of the accounting period after all adjusting and closing entries have been posted; a final check on the balance of the ledger to ensure that all temporary accounts have zero balances and that total debits equal total credits.
Define reversing entry.
an entry made on the first day of an accounting period that is the exact reverse of an adjusting entry made on the last day of the previous period.