Flashcards in Reversed Chapter (1) Deck (53):
1
The form of balance sheet that resembles the basic format of the accounting equation; with assets on the left side and Liabilities and Stockholder’s Equity sections on the right side.
account form
2
An information system that provides reports to stakeholders about the economic activities and condition of a business.
accounting
3
A list of the assets; liabilities; and owner’s equity as of a specific date; usually at the close of the last day of a month or a year.
balance sheet
4
An organization in which basic resources (inputs); such as materials and labor; are assembled and processed to provide goods or services (outputs) to customers.
business
5
A concept of accounting that limits the economic data in the accounting system to data related directly to the activities of the business.
business entity concept
6
An economic event or condition that directly changes an entity’s financial condition or directly affects its results of operations.
business transaction
7
The process of transferring temporary accounts balances to permanent accounts at the end of the accounting period.
Commission
8
The stock outstanding when a corporation has issued only one class of stock.
common stock
9
A business organized under state or federal statutes as a separate legal entity.
corporation
10
A concept of accounting that determines the amount initially entered into the accounting records for purchases.
cost concept
11
Distribution of a corporation’s earnings to stockholders.
dividends
12
The amount by which revenues exceed expenses.
earnings
13
An integrated business and information system used by companies to plan and control both internal and supply chain operations.
equity
14
Moral principles that guide the conduct of individuals.
ethics
15
Assets used up or services consumed in the process of generating revenues.
expenses
16
Revenue from providing services.
fees earned
17
The branch of accounting that is concerned with recording transactions using generally accepted accounting principles (GAAP) for a business or other economic unit and with a periodic preparation of various statements from such records.
financial accounting
18
The authoritative body that has the primary responsibility for developing accounting principles.
Financial Accounting Standards Board (FASB)
19
Financial reports that summarize the effects of events on a business.
financial statements
20
Generally accepted guidelines for the preparation of financial statements.
generally accepted accounting principles (GAAP)
21
A type of financial accounting report that is distributed to external users. The term “general purpose” refers to the wide range of decision-making needs that the reports are designed to serve.
general-purpose financial statements
22
A summary of the revenue and expenses for a specific period of time; such as a month or a year.
income statement
23
Money received for interest.
interest revenue
24
An organization that issues International Financial Reporting Standards for many countries outside the United States.
International Accounting Standards Board (IASB)
25
The rights of creditors that represent debts of the business.
liabilities
26
A business form consisting of one or more persons or entities filing an operating agreement with a state to conduct business with limited liability to the owners; yet treated as a partnership for tax purposes.
limited liability company (LLC)
27
method A method of valuing inventory that reports the inventory at the lower of its cost or current market value (replacement cost).
management
28
A type of business that changes basic inputs into products that are sold to individual customers.
manufacturing business
29
The comprehensive budget plan linking all the individual budgets related to sales; cost of goods sold; operating expenses; projects; capital expenditures; and cash.
matching concept
30
A type of business that purchases products from other businesses and sells them to customers.
merchandising business
31
An approach to transfer pricing that allows managers of decentralized units to agree (negotiate) among themselves as to the transfer price.
net income
32
The amount by which expenses exceed revenues.
net loss
33
A concept of accounting that requires accounting records and the data reported in financial statements to be based on objective evidence.
objectivity concept
34
The owner’s right to the assets of the business.
owner’s equity
35
An unincorporated business form consisting of two or more persons conducting business as co-owners for profit.
partnership
36
Items such as supplies that will be used in the business in the future.
prepaid expenses
37
The field of accounting whereby accountants are employed by a business firm or a not-for-profit organization.
private accounting
38
The difference between the amounts received from customers for goods or services provided and the amounts paid for the inputs used to provide the goods or services.
profit
39
A business owned by one individual.
proprietorship
40
The field of accounting where accountants and their staff provide services on a fee basis.
public accounting
41
Public Company Accounting Oversight Board (PCAOB) A new oversight body for the accounting profession that was established by the Sarbanes- Oxley Act.
Public Company Accounting Oversight Board (PCAOB)
42
A leverage ratio that measures the margin of safety of long-term creditors; calculated as the net fixed assets divided by the long-term liabilities.
ratio of liabilities to stockholders’
43
Money received for rent.
rent revenue
44
Net income retained in a corporation.
retained earnings
45
A summary of the changes in the retained earnings in a corporation for a specific period of time; such as a month or a year.
retained earnings statement
46
Increases in assets from performing services or delivering products to customers.
revenues
47
The total amount charged customers for merchandise sold; including cash sales and sales on account.
sales
48
The relative distribution of sales among the various products available for sale.
Sarbanes-Oxley Act
49
An act passed by Congress to restore public confidence and trust in the financial statements of companies.
Securities and Exchange
50
A business providing services rather than products to customers.
service business
51
A summary of the cash receipts and cash payments for a specific period of time; such as a month or a year.
statement of cash flows
52
The owners’ equity in a corporation.
stockholders’ equity
53