ACC 211 CH.1

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  1. Service Businesses
    • Provide services rather than products to customers.
    • Delta Air Lines (transportation service)
    • The Walt Disney Company (Entertainment Service)
  2. Merchandising Businesses
    • Sell products they purchase from other businesses to customers
    • Wal-mart (general merchandise)
    • ( Internet books, music, videos)
  3. Manufacturing businesses
    • Change basic inputs into products that are sold to customers.
    • Ford Motor Co. (Cars, trucks, vans)
    • Dell Inc. (personal computers)
  4. Accounting
    provides reports to users about the economic activities and condition of a business. "language of business"
  5. Managerial accounting
    Provides internal users with information
  6. Financial accounting
    Provides external users with information.
  7. GAAP
    Generallly Accepted Accounting Principles. What accountants follow when making financial statements.
  8. FASB
    Financial Accounting Standards Board. Has the primary responsibility for developing accounting principles. The FASB publishes Statements of financial Accounting Standards as well as interpretations of theses standards.
  9. SEC
    Securities and Exchange Commission. An agency of the U.S. government, has authority over the accounting and financial disclosures for companies whose shares of ownership are traded and sold to the public.
  10. IASB
    International Accounting Standards Board. The IASB issues International Financial Reporting Standards. Significant differences currently exist between FASB and IASB accounting principles.
  11. Business Entity Concept
    Limits the economic data in an accounting system to data related directly to the activitiesof the business. In other words the business is viewed as an entity separate from its owners, creditors, or other businesses.
  12. Proprietorship
    • is owned by one individual
    • Easy and cheap to organixe
    • Resources are limited to those of the owner
    • Used by small businesses
  13. Partnership
    Is owned by two or more individuals
  14. The Accounting Equation
    Assets = Liabilities + Owners Equity
  15. Capital Stock
    stock issued to owners (stockholders), such as Chris Clark, is referred to as capital stock.
  16. Stockholders Equity
    • The owners equity in a corporation. 
    • Assets = Stockholders Equity
    • Cash   = Capital Stock
    • 25,000
  17. Cost Concept
    Amounts are initially recorded in the accounting records at their cost or purchase price.
  18. Objectivity concept
    requires that the amounts recorded in the accounting records be based on objective evidence.
  19. Unit measure concept
    Requires that economic data be recorded in dollars. Money is a common unit of measurement for reporting financial data and reports.
  20. Asset
    The resources owned by a business.
  21. Liabilities
    The rights of creditors are the debts of the business.
  22. Owners Equity
    The rights of the owners .
  23. Account receivable
    A claim against the customer. An account receivable is an asset and the revenue is earned and recorded as if cash had been received. When customers pay their accounts, cash increases and AR decreases.
  24. Expenses
    Spent cash or used up other assets in earning revenue. Assets used in the process of earning revenue are called....
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ACC 211 CH.1
2013-06-10 21:42:53
ACC 211

ACC 211 CH.1
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