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Depreciation
The portion of useful life that is expiredof all capital assets.
Prepaid Expenses
The portion of current assets that have been used up or expired.
Accured Revenues
Revenues that has been done but not recorded and we have not recieved payment for.
Accured Expenses
Expenses that have occurred but were not recorded and that we have not paid for.
Unearned Revenues
The amount of previous unearned revenues that have now been earned in this peroid.
Straight Line Depreciation Equation
Cost of Asset - Estimate Salvage Value / Estimated Useful Life
Matching Principle
matches expenses in the same accounting peroid as the revenues they helped earn.
Timeliness Principle
assumes activities can be divided into specific time peroids.
General Journal
Most flexible; can be used to record any type of transaction
Journal
where transactions are recorded before they are recorded into accounts; posted from journal to ledger.
Ledger
record containing all accounts used by a business.
Posting
Transferring journal entries into ledger accounts.
Slide
Error occuring from adding or deleting a zero in a value.
Transposition Error
two digits being switched or transposed
within
a number
Accounting Equation
A=L+E
AKA
: Balance Sheet Equation!!
Balance Sheet
reports financial position of a business at a point in time.
-
Assets = Liabilities + Owners Equity
Business Entity Principle
requires every business be separte from its owner.
Cost Principle
requires financial statement info to be based on actual costs incurred in transaction.
Equity
owners claim on the assets of a business.
Going Concern Principle
requires financial statements to reflect that the business will continue operating instead of being closed or sold.
Income Statement
subtracts expenses from revenues.
Revenues - Expenses =NI/NL
Monetary Unit Principle
expression of trasactions in money units.
Revenue Recongition Pronciple
revune is recorded at the time it is earned reguardless of whether cash or another asset has been exchanged.
Statement of Changes in Equity
reports changes in equity over the reporting peroid.
-
Starting Capital + Investments +/- NI/NL-Withdrawals =Owner, Capital
Contra Account
linked with another account and having an opposite normal balance.
Subtraction from the other accounts balance.
Account Form Balance Sheet
Lists assets on left and liabilities on the right.
Accural Basis Accounting
financial statements that uses adjusting process to recongize revenues when earned and expenses when incurred.
Cash Basis Accounting
revenues are recongized when cash is recieved, and expenses are recongized when cash is paid.
Interim financial reports
financial reports covering less than one year.
Author
StudyGirl212
ID
142000
Card Set
Accounting
Description
First year accounting course.
Updated
3/16/2012, 8:01:48 PM
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