Balance Sheet Accounts Flashcards
Cash – Asset
= Amounts that are in cash at bank
Beginning Balance + Cash Receipts/Inflows – Cash Disbursement/Outflows = Ending Balance
Accounts Receivable – Asset
= Used to track amounts customers owe the company for services already provided. Customers will pay the company in the future.
Beginning Balance + Credit Sales to Customers – Cash Receipts from Customers on A/R they owe – Specific
Customer Accounts Written Off = Ending Balance
Allowance for Uncollectible Accounts – CONTRA-Asset
= Used to estimate the amount of Accounts Receivable that will not be collected from customers.
This account is subtracted from Accounts Receivable to determine ‘Net Realizable Value’ of Accounts Receivable.
Beginning Balance + Bad Debt Expense – Specific Customer Accounts Written Off = Ending Balance
Prepaid Expenses – Asset
= Future expenses (insurance, rent, etc.) that the company paid in advance. As time passes or the item is used up this asset account is reduced and the amount is transferred to an expense account.
Beginning Balance + Prepayment for Items purchased prior to consuming them in the business –
Consumption/Use of the Asset by the business = Ending Balance
Supplies – Asset
= Account used to track supplies (office, cleaning, etc.) that the company will use (these items are not things sold to customers)
Beginning Balance + Purchases – Used by business = Ending Balance
Inventory – Asset
= Account used to track the items that the company intends to sell to customers. It should include all costs
necessary to get the item ready to be sold.
Beginning Balance + Purchases – Items sold to customers – Lower of Cost or Market Adjustment – Adjustment for Shrinkage (Inventory Loss) = Ending Balance
Plant, Property and Equipment – Asset
= Real Property (tangible) assets that the company has and uses in the operations of its business.
Beginning Balance + Purchases – Disposals = Ending Balance
Accumulated Depreciation – CONTRA-Asset
= Used to track the life to date depreciation expense for Plant, Property and Equipment
Beginning Balance + Depreciation Expense – A/D associated with Disposals = Ending Balance
Intangible Assets (Goodwill, Patents, etc.) – Asset
= Intangible (not physical) assets that the company has acquired.
Beginning Balance + Purchases – Disposals = Ending Balance
Accounts Payable – Liability
= Used to track specific amounts owed to specific vendors/supplies to the company.
Beginning Balance + Purchases on Credit – Payments to Vendors = Ending Balance
Wages (Salaries) Payable – Liability
= Used to track amounts of earned but not yet paid that the company’s employees are entitled to.
Beginning Balance + New Wages Owing to Employees – Payments to Employees = Ending Balance
Unearned (Deferred) Revenue – Liability
= Used to track amounts received from customers prior to the company providing the good or service.
Beginning Balance + Receipts/payments from Customers in advance of services being provided – Services that were prepaid are provided to Customers = Ending Balance
Loans Payable – Liability
= Used to track principal amounts outstanding that the company must pay in the future.
Beginning Balance + Note Proceeds (from banks or other lenders) – Payments to Lender = Ending Balance
Interest Payable – Liability
= Used to track interest that is owed due to the passage of time but where the payment is not yet due to the
lender or bond holder.
Beginning Balance + Accrued Interest – Interest Payments = Ending Balance
Common Stock (two accounts, one for Par and one for Paid in Capital In Excess of Par) – Equity
= Used to the value of common stock issued (if common stock has a par value then amounts will be split between
the two accounts
Beginning Balance + Stock Issued to Owners or Investors – Stock Redeemed & Retired = Ending Balance
