Details Title: ACC 203 - CH1 Description: Introducing Accounting Total Flash Cards: 40 Created: 09/14/2008 12:02:55		New Users: To study from this flashcard set, or to create your own your own study flash cards, REGISTER HERE. Existing Users: CLICK HERE. Additional Accounting Flashcards
Cards in this set: Term Cost Principle Definition Acc. Info based only on actual costs; only measured by cash values Term Objectivity Principle Definition Data Supported only by evidence not by someone's opinion Term Going-Concern Principle Definition Statements reflect the assumption that the business will continue operating Term Business Entity Principle Definition Business is accounted for separately from other business entities, including its owner(s) Term Audit Definition Analysis and report or an organizations accounting system, records and reports using various tests. (Adds credibility to org's financial statements. Term Audit Definition Analysis and report or an organizations accounting system, records and reports using various tests. (Adds credibility to org's financial statements. Term Audit Definition Analysis and report or an organizations accounting system, records and reports using various tests. (Adds credibility to org's financial statements. Term Tax Accounting Definition Area that includes planning future transactions to minimize taxes paid. Term Public Accountants Definition Term SEC Definition Securities and Exchange Commission: Gov. group that establishes securities regulations for companies that issue stock. (Part of GAAP) Term IASB Definition International Accounting Standards Board:identifies preferred accounting practices - standardization of financial statements. (Part of GAAP) Term GAAP Definition Generally Accepted Accounting Principles: concepts and rules that aim to make info in financial statements relevant, reliable, and comparable. Term Accounting Definition Identifying economic events; involves selecting economic activities to a particular org. -once identified, it is recorded to provide financial history through financial reports. Term Three steps to accounting? Definition 1) Identify: select economic events/transaction 2) Record: record, classify, summarize. (Bookkeeping) 3) Communicate: prepare reports, analyze, interpret. Term Two subcategories of communication? Definition To (1) internal and (2) external Users Term Internal user include? Definition Management or supervisors (Managerial Accounting) Term External Users Include? Definition investors, creditors, etc. (Financial Accounting) Term Financial Accounting Definition provides econ. info for external users Term Managerial Accounting Definition Provides econ info for internal users. Term Two orgs responsible for establishing GAAP Definition 1) FASB: Financial Accounting Standards Bureau - Establishes broad acc. principles 2) SEC: Security and Exchange COmmission - Gov. Agency that requires companies to file financial reports following GAAP Term Monetary Unit Principle Definition transaction data only be recorded in terms of money in an accounting record (Note: added assumption that unit of measure, $, remains sufficiently constant) Term Proprietorship Definition Business owned by one person Term Partnership Definition Business owned by two or more persons associated as partners Term corporation Definition business organized as seperate legal entity under state corporation law, and having ownership divided into transferable shares of stock. (Acts through its managers) Term Basic Accounting Equasion Definition Assets = Liabilities + Owners Equity Term Assets Definition Resources that provide future economic benefits (Ex: building, can get $ for it) aka resources owned by business that are used for activities such as production, consumption, and exchange Term Liabilities Definition Creditor claims against assets that represent the debts and obligations of the entity. Term Owners Equity Definition Owners residual claims on total assets (Part of assets owner owns) = total assets - total liability Term Capital Definition Subset of owners equity - the owners investment in the business Term Drawings Definition the withdrawal of of cash or other assets for the personal use of the owner (Must be recorded) Term Revenues Definition Gross increase in owners equity from business activities Term External Transactions Definition economic events between company and some outside enterprise Term Internal Transactions Definition Economic events that occur entirely within one company Term Income Statement Definition Presents 1) Revenues 2)Expenses 3)Net Income for a specific period of time Term Owners equity Statement Definition summarizes changes in owners equity for a specific period of time. Term Balance Sheet Definition Records Assets, liabilities, and owners equity for a specific period of time. Term What does accounting do? Definition It identifies, records, and communicates. Term What kind of Information does Accounting Communicate? Definition Relevant, Reliable and Comparable information. Term Financial Accounting Standard Board Definition Sets the Standards for accounting across the board. Term Revenue Recognition Principle Definition *Revenue is recognized when earned. *Proceeds need not be in cash *Measure revenue by cash and value of items received.