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  1. an information and measurement system that identifies, records, and communicates relevant, reliable, and comparable information about an organization’s business activities
  2. The generally accepted principles of accounting in America
  3. a principle in which accounting information is based on actual cost. This means if cash is given for a service, its cost is measured as the amount of cash paid.
    Cost Principle
  4. 1. Revenue is recognized when earned. The earnings process is normally complete when
    services are performed or a seller transfers ownership of products to the
    2. Proceeds from selling products and services need not be in cash. A common noncash proceed received by a seller is a customer’s promise to pay at a future date,
    called credit sales.
    3. Revenue is measured by the cash received plus the cash value of any other items
    Revenue Recognition Principle
  5. a company must record the expenses it incurred to generate the revenue reported
    Matching or Expense Recognition Principle
  6. the principle in which a company is required to report the details behind the financial statements if the details so disclosed would impact the users’ decision-making process.
    Full Disclosure Principle
  7. in the absence of information to the contrary, a business entity is assumed to continue operations into the foreseeable future
    Going-Concern Assumption
  8. tells us that we will only record accounting information that can be expressed in monetary units, usually dollars in the United States.
    Monetary Unit Assumption
  9. tells us that we must separate out the transaction of individual owners of a business
    from those of the business.
    Business Entity Assumption
  10. presumes that the life of a company can be divided into time periods such as months and years, and that useful reports can be prepared for those periods.
    Time Period Assumption
  11. resources a company owns or controls
  12. what a company owes its non-owners
    (creditors) in future payments, products, or services
  13. an owner's claim on his/her assets
  14. revenue minus expenses
    Net Income
  15. assets=liabilities + equity
    Accounting Equation
  16. a record of increases and decreases in a
    specific asset, liability, equity, revenue, or expense item.
  17. a record containing all accounts used by
    the company.
    General Ledger
  18. What are these examples of: Cash, Land, Building, Equipment, Supplies, Prepaid Accounts (guarantee of a service), Notes Receivable, Account Receivable
    Asset Accounts
  19. What are these examples of: Accounts Payable, Notes Payable, Accrued Liabilities, Unearned Revenue (cash received, but service not performed).
    Liability Accounts
  20. What are these examples of: owner's capital, owner's withdrawals, revenues, expenses.
    Equity Accounts
  21. describes a company’s revenues and
    expenses along with the resulting net income or loss over a period of time due
    to earnings activities
    Income Statement
  22. explains changes in equity from net income (or loss) and from any owner investments and
    withdrawals over a period of time.
    Statement of Owner's Equity
  23. describes a company’s financial position (types and amounts of assets, liabilities, and
    equity) at a point in time.
    Balance Sheet
  24. identifies cash inflows (receipts) and
    cash outflows (payments) over a period of time.
    Cash Flow Statement
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  29. net income divided by total average assets. Total average assets is
    computed by adding the beginning total assets to the ending total assets and
    divide the total by 2.
    Return on Assets
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    Do not confuse the words Debit and Credit here. They are completely meaningless. Left side is the duck side and right is cow.
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  34. a chronological listing of transactions
    General Journal
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    Example of Journalized transaction
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Card Set:
2015-02-12 18:58:36

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