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28 Cards in this Set
- Front
- Back
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accounting |
the process of planning, recording, analyzing, and interpreting financial information. |
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accounting system |
a planned process designed to compile financial data and summarize the results in accounting records and reports. |
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financial statements |
financial reports that summarize the financial condition and operations of a business. |
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net worth statement |
a formal report that shows what an individual owns, what an individual owes, and the difference between the two. |
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asset |
anything of value that is owned. |
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liability |
an amount owed. |
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personal net worth |
the difference between personal assets and personal liability’s. |
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equity |
the difference between assets and liabilities. |
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ethics |
the principals of right and wrong that guide an individual in making decisions. |
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business ethics |
the use of ethics in making business decisions. |
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service business |
a business that performs an activity for a fee. |
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proprietorship |
a business owned by one person. |
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business plan |
a formal written down document that describes the nature of a business and how it will operate. |
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GAAP |
generally accepted accounting principles. the standards and rules accountants follow while recording and reporting financial activities. |
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GAAP |
generally accepted accounting principles. the standards and rules accountants follow while recording and reporting financial activities. |
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equities |
financial rights to the assets of a business. |
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owners equity |
the amount remaining after the value of all liabilities is subtracted from the value of all assets. |
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accounting equation |
the equation showing the relationship among assets, liabilities, and owners equity. |
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transaction |
any business activity the changes assets, liabilities, or owners equity. |
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account |
a record the summarizes all the transactions pertaining to a single item in the accounting equation. |
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account title |
the name given to an account |
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account balance |
the difference between the increases and decreases in an account. |
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capital account |
an account used to summarize the owners equity in a business. |
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creditor |
a person or business to whom a liability is owed. |
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revenue |
an increase is equity resulting from the sale of goods or services. |
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sale on account |
a sale for which a payment will be received at a later date. |
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expense |
the cost of goods and services used to operate a business. |
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withdrawals |
assets taken from the business for the owners personal use. |
