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Flashcards in Powerpoint 3 Deck (19):
1

Free Cash Flow

Cash provided by operations - capital expenditures - cash dividends

A measure of solvency

The greater the better

could be liquidity too..

2

Normal Dr. Balance

Cash

Inventory

Accounts receivable

Utilities expense

Prepaid Rent

Equipment

Dividends

3

Normal Cr. Balance

Accounts payable

Common Stock

Notes payable

Retained earings

Sales revenue

4

Debits and Credits are synonymous to:

Left and Right

5

If an individual asset account is increased, which of the following corresponding effects would be possible:

Increase in a specific liability

Decrease in another asset

Increase in stockholders' equity

All of the above are possible

6

Accounting Information System

A system of collecting and processing transaction data and communicating financial information to decision makers

7

Accounting Transactions

The economic events that require recording in the financial statements

8

Account

An individual accounting record of increase and decrease in a specific asset, liability, stockholders equity, revenue, or expense item

9

Debit

The left side of an account

Dr.

10

Credit

The right side of an account

Cr.

11

Normal Balance

The side of the T-Account that leads to an INCREASE

12

DEAD

Debit increased:

Expenses

Assets

Dividends

13

CuRLS

Credit normal balance - credit increased

Revenues

Liabilities

Stockholders' equity

14

Ledger

The entire group of accounts maintained by a company

15

Chart of accounts

The list of accounts that a company uses

It is important to note that the number and type of accounts used differ from company to company - depends on size, complexity, industry, type of business

16

The Trial Balance

Lists all accounts and their balances at a given time (typically end of accounting period)

Proves that all of the accounts balance in the accounting equation after posting is completed

 

17

___________ is useful in creating the financial statements

The trial balance

18

In the ______ the accounts are listed in order of liquidity

trial balance

19

the ________ is helpful in identifying posting errors and is a complete listing of all T-accounts

trial balance