FABM (THE BALANCE SHIT)

Question 1

is another term for the
balance sheet

Answer 1

statement of financial position

Question 2

The format of the statement of financial position follows the

Answer 2

Basic Accounting

Question 3

Liabilities + Equity

Answer 3

= Assets

Question 4

bills, coins, bank balances, money orders, and checks.

Answer 4

Cash

Question 5

used to acquire goods and services or to eliminate
obligations.

Answer 5

Cash

Question 6

which refers to assets that can be readily converted into cash

Answer 6

Cash equivalent

Question 7

more likely to retain a large amount of cash on
hand if it routinely deals with cash transactions

Answer 7

Business

Question 8

One of the basic accounting terms is a

Answer 8

normal balance

Question 9

the account balance can be
called

Answer 9

Normal

Question 10

Normal balance of assets

Answer 10

Debit

Question 11

Normal balance of contra assets

Answer 11

Credit

Question 12

Normal balance of liability

Answer 12

Credit

Question 13

Normal balance of owners equity

Answer 13

Credit

Question 14

Owners drawing or dividends

Answer 14

Debit

Question 15

Normal balance of Revenues or income

Answer 15

Credit

Question 16

Normal balance of expenses

Answer 16

Debit

Question 17

Normal balance of gains

Answer 17

Credit

Question 18

Normal balance of losses

Answer 18

Debit

Question 19

the accounts are retained permanently in the SFP until their balances
become zero.

Answer 19

Permanent Accounts

Question 20

Forms of Statement of financial position

Answer 20

Report Form
Account form

Question 21

shows asset accounts first and then
liabilities and owner’s equity accounts after.

Answer 21

Report form

Question 22

shows assets on the left side and
liabilities and owner’s equity on the right side just like the debit
and credit balances of an account

Answer 22

Account form

Question 23

what are the current assets

Answer 23

cash, cash equivalents, accounts receivable, stock inventory, marketable securities, pre-paid liabilities, and other liquid assets.

Question 24

What are the non current assets

Answer 24

Intangible assets, property plant and equipment, Land
Office buildings, Manufacturing plants, Vehicles.
Natural resources, Investments, like bonds, Patents and trademarks, Equipment.

Question 25

What are the current liabilities

Answer 25

accounts payable, payroll due, payroll taxes, accrued expenses, short-term notes payable, income taxes, interest payable, accrued interest, utilities, rental fees, and other short-term debts.

Question 26

Components of sfp

Answer 26

Assets, liabilities, equity

Question 27

features the performance and activities of the company for a certain period. It generally contains the revenues and expenses incurred by an entity for a specific period.

Answer 27

statement of comprehensive income

Question 28

would differ based on the form of business that the company has

Answer 28

Statement of changes in equity (SOCE)

Question 29

The three forms of business of SOCE

Answer 29

Sole Proprietorship, Partnership and Corporation

Question 30

It is an entity whose assets, liabilities, income, and expenses are centered or owned by only one person

Answer 30

Sole Proprietorship

Question 31

Contents of the SoCE for Sole Proprietorship

Answer 31

Beginning Capital, Additional Investment, Drawings,Net Income/Loss

Question 32

It is the amount of capital that the company has at the start of the period.

Answer 32

Beginning Capital

Question 33

The amount of assets that the owner withdrew from the business for his/her personal use.

Answer 33

Drawings

Question 34

– It is the amount of investment that the owner has added to its business.

Answer 34

Additional Investment

Question 35

the amount of profit or loss that the company incurred during the period

Answer 35

Net Income/Loss

Question 36

Parts of the SoCE of a Sole Proprietorship

Answer 36

Heading, Beginning capital, Increases in Equity,Decreases in Equity, Ending Capital

Question 37

it includes the name of the company, title of the financial statement, and the period covered of the financial statement

Answer 37

Heading

Question 38

the amount of the owner’s capital at the start of the period

Answer 38

Beginning capital

Question 39

it includes the additional investment and net income of the company

Answer 39

Increases in Equity

Question 40

– it includes withdrawals and net loss of the company

Answer 40

Decreases in Equity

Question 41

it is the balance of equity after adding all the increases and deducting the decreases from the beginning capital

Answer 41

Ending Capital

Question 42

Ending Capital

Answer 42

partnership

Question 43

It is an entity whose assets, liabilities, income, and expenses are centered or owned by two or more persons

Answer 43

Beginning Partners Capital

Question 44

– It is the amount of investment that each partner has added to its business

Answer 44

Additional Investment

Question 45

The amount of assets that each partner withdrew from the business for his/her personal use.

Answer 45

Drawings

Question 46

the share of each partner in the profit or loss of the company

Answer 46

Share in Net Income/Loss

Question 47

It is an entity whose assets, liabilities, income and expenses are centered or owned by itself being a legally separate entity from its owners

Answer 47

Corporation

Question 48

- it is the number of shares issued by the corporation to its stockholders at original price.

Answer 48

Common Stock

Question 49

the difference between the issue price and the original price of the stocks sold.

Answer 49

Additional paid in capital

Question 50

– it is the accumulated net income of the company since the start of the operation of the business less the dividends declared and paid by the company to the stockholders

Answer 50

Retained earnings

Question 51

It provides an analysis of inflows and/or outflows of cash from/to operating, investing, and financing activities

Answer 51

Statement of cash flows

Question 52

Steps in Preparing a Statement of Cash Flows

Answer 52

From the ledger of Cash, group together the transactions that have same nature. Identify each transaction if it is an inflow or outflow. Compute for the net cash flow from each activity and add it to get the net change in cash. Classify each transaction according to its activity: Operating, Investing or Financing.

Question 53

Different Parts of Statement of Cash Flows

Answer 53

Operating Activities Investing Activities Net Change in Cash Beginning Cash Balance Ending Cash Balance

Question 54

– It include activities that are directly related to the main revenue-producing activities of the company such as cash from customers and cash paid to suppliers/employees

Answer 54

Operating activities

Question 55

It is the amount of investment that the owner has added to its business.

Answer 55

Investing activities

Question 56

It is the amount of investment that the owner has added to its business.

Answer 56

Financing activities

Question 57

- It is the net amount of change in cash whether it is an increase or decrease for the current period. The total change brought by operating, investing, and financing activities.

Answer 57

Net Change in Cash

Question 58

The balance of the cash account at the beginning of the accounting period

Answer 58

Beginning Cash Balance

Question 59

The balance of the cash account at the end of the accounting period computed using the beginning balance plus the net change in cash for the current period

Answer 59

Ending Cash Balance

Question 60

Account used to record transportation cost of merchandise purchased by the company.

Answer 60

Freight In

Question 61

Account used to record early payments by the company to the supplier of merchandise.

Answer 61

Purchase Discount