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The balance sheet is also called?

the statement of financial position

1

On the balance sheet, Assets =

Liabilities + Owner's Equity

2

For each transaction, the accountant determines three things. They are?

1. which specific accounts the transaction effects
2. whether it increases or decreases each account balance
3. the amount of the change in each account balance

3

The process of identifying, recording, and summarizing economic information and reporting it to decision makers

accounting

4

The field of accounting that serves external decision makers, such as stockholders, suppliers, banks, and government agencies

financial accounting

5

The field of accounting that serves internal decision makers, such as top executives, department heads, college deans, hospital administrators, and people at other management levels within an organization

management accounting

6

A document prepared by management and distributed to current and potential investors to inform them about the company's past performance and future prospects

annual report

7

A document that U.S. companies file annually with the SEC. It contains the company's financial statements

Form 10-K

8

A financial statement that shows the financial status of a business entity at a particular instant in time

balance sheet (statement of financial position)

9

Assets = Liabilities + Owner's Equity

balance sheet equation

10

Economic resources that a company expects to help generate future cash inflows or help reduce future cash outflows

assets

11

Economic obligations of the organization to outsiders, or claims against its assets by outsiders

liabilities

12

Promissory notes that are evidence of a debt and state the terms of payment

notes payable

13

The owner's claims on an organization's assets, or total assets less total liabilities

owner's equity

14

An organization or a section of an organization that stands apart from other organizations and individuals as a separate economic unit

entity

15

Any event that both affects the financial position of an entity and that an accountant can reliably record in money terms

transaction

16

An asset that a company expects to provide services for more than 1 year

long-lived asset

17

A summary record of the changes in a particular asset, liability, or owner's equity

account

18

Goods held by a company for the purpose of sale to customers

inventory

19

Buying or selling on credit, usually by just an "authorized signature" of the buyer

open account

20

A liability that results from a purchase of goods or services on open account

account payable

21

A transaction that affects more than two accounts

compound entry

22

A person or entity to whom a company owes money

creditor

23

A business with a single owner

sole proprietorship

24

A form of organization that joins two or more individuals together as co-owners

partnership

25

A business organization that is created by individual state laws

corporation

26

A feature of the corporate form of organization whereby corporate creditors (such as banks or suppliers) ordinarily have claims against the corporate assets only, not against the personal assets of the owners

limited liability

27

A corporation that sells shares in its ownership to the public

publicly owned

28

A corporation owned by a family a small group of shareholders, or a single individual, in which shares of ownership are not publicly sold

privately owned

29

Formal evidence of ownership shares in a corporation

capital stock certificate (stock certificate)