Accounting 2 Flashcards Preview

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Flashcards in Accounting 2 Deck (43):
1

accounts receivable

  • business has right to the property until customer pays it off
  • money owed to business from customer purchasing items on credit/on account
  • ex. boscov's customer using charge card

2

cash or goods used to generate income either by investing in a business or a different income property

capital

3

depreciation

decrease in value of property as it becomes old and gradually wears out

4

assets

something a business or person owns of value

5

liquid asset

asset that can easily be converted to cash

6

What is the asset equation?

Assets = Liabilities + Owners Equity

7

liability

  • money you own for something  - ex. car loan, mortgage
  • buy now pay later

8

examples of notes payable

mortage payable

taxes payable

 

9

examples of items that appreaciate

house

land

antiques

10

items available for sale

inventory

11

exampes of items that depreciate

cars

electronics

computers

12

cash

all monetary items

 

ex. bank deposits, currency, coins, checks, money orders

13

economic event that causes a change in assets, liabilities or owner's equity

business transaction

14

inventory

  • items available for sale (on shelves or in backrooms)
  • ex. best buy's tvs in store

15

general incrase in value of property that occurs over time

appreciation

16

financial claim

who has the right to use something

ex. taking away your car by bank if you do not pay loan

17

double entry accounting

where each transaction affects at least 2 accounts

18

subdivision under assets, liabilities or owner's equity that summarize charges and shows balance for a specific item

account

19

what goes under liabilities column

accounts payable

20

what goes under assets column

  • supplies
  • cash in bank
  • inventory
  • equipment
  • account receivable
  • anything that can be converted to cash
  • accounts

21

account

subdivision under assets, liablities or owner's equity that summarize charges and shows balance for a specific item

 

22

owners equity

value of owner's investment

23

accounts receivable

  • aka A/R
  • money owed to businesses from customers purchasing items on credit or on account

24

appreciation

general increase in value of property that occurs over time

25

examples of assets

car, house, suitcases, perfume, airplanes

26

anything of value a business or person owns and controls

property

27

where each transaction affects at least 2 accounts

double entry accounting

28

examples of office supply

computer

copier

pens

pencils

stapler

etc

29

written promise to pay money owed at specified times

notes payable

30

value of owner's investment

owner's equity

31

accounts payable

  • purchasing on account
  • purchasing goods and or services on account
  • ex. target purchased cheetos inventory from frito-lay on account 

32

property

anything of value a business or person owns and controls

33

business transaction

economic event that causes a change in assets, liabilities or owners equity

 

ex. buy a movie ticket - your assets decrease (cash) and the theaters assets increase

34

who has right to use something, legal right to property

financial claim

35

notes payable

  • aka promissory note
  • written promise to pay money owed at specified times

36

what goes under owners equity

  • revenue +
  • expense -
  • owner's name and capital

37

money owed to businesses from cusotmers purchasing items on credit/on account

accounts receivable

38

capital

cash or goods used to generate income either by investing in a business or a different income property

39

money owed to businesses from customers purchasing items on credit or on account

accounts receivable

40

purchasing on account

accounts payable

41

decrease in value of a property as it becomes old and gradually wears out

depreciation

42

money you owe for something

liability

43

something a business or person owns of value

assets