Debit and Credit

Question 1

What is double entry accounting

Answer 1

recording 2 sides of every transaction

Question 2

What is a T account

Answer 2

simplified accounting form with debit and credit

Question 3

What is the account balance

Answer 3

The difference between the total debits and credits

Question 4

What does debit increase and decrease

Answer 4

increase assets
decrease liabilities

Question 5

What does credit increase mean

Answer 5

Entry that increases liability and equity
Decreases assets

Question 6

what are source documents

Answer 6

cash register tape, invoices or check stubs

Question 7

whats a journal

Answer 7

book or record of accounting data

Question 8

book of original entry

Answer 8

journal of recorded transactions

Question 9

Special journal

Answer 9

records specific types of repetitve transactions

Question 10

General journal

Answer 10

All types of accounting transactions

Question 11

Chart of accounts

Answer 11

lists of all journals and accounts

Question 12

posting

Answer 12

copying info from journals to ledgers

Question 13

trial balance

Answer 13

used to check math of CCOUNTING

Question 14

liquidity ratio

Answer 14

companies ability to pay short term

Question 15

solevency rario

Answer 15

companies ability to pay long term

Question 16

profitability ratio

Answer 16

how well do assets generate profit

Question 17

stock market ratio

Answer 17

current share price

Question 18

current vs noncurrent

Answer 18

current is assets or liabilities expected to be used up soon
ie. cash, supplies

noncurrent assets or liabilities assets or liabilities that are harder to convert into cash
ie. bond, land