Acct 351 Chapter 03 Flashcards
An individual accounting record of increases and decreases in a specific asset, liability, or shareholders’ equity item.
A series of steps followed by accountants in recording transactions and preparing financial statements
accounting information system
The system of collecting and processing transaction data and communicating financial information to interested parties
Expenses incurred, but not yet paid or recorded at the statement date.
Revenues earned, but not yet received in cash or recorded at the statement date
adjusted trial balance
A list of all open accounts in the ledger and their balances taken immediately after all adjustments have been posted
Journal entries made at the end of the accounting period to ensure that the revenue recognition and matching principles are followed
A financial statement, otherwise known as the statement of financial position, that shows an enterprise’s financial condition at the end of a period
The difference between the cost of any depreciable asset and its related accumulated amortization.
The journal entries that close the temporary accounts in order to start a new financial reporting period. These amounts are posted to retained earnings.
The procedure generally followed to reduce the balance of temporary accounts to zero in order to prepare the accounts for the next period’s transactions
contra asset account
An account that is offset against an asset account on the balance sheet
The right side of a general ledger account.
The left side of a general ledger account.
The process of allocating the cost of tangible capital assets to the accounting periods benefiting their use. (Synonym: amortization)
double-entry accounting system
The equality of debits and credits when recording transactions, which proves the accuracy of the recorded amounts
A happening of consequence, which is generally the source of changes in asset, liability, and equity balances. An event may be internal or external.
The principal means through which financial information is communicated to those outside an enterprise. They provide a firm’s history, quantified in money terms.
A chronological listing of transactions and other events expressed in terms of debits and credits to particular accounts
A collection of all assets, liability, shareholders’ equity, revenue, and expense accounts and their respective balances