Details Title: Accounting 298 Description: Test 1 Total Flash Cards: 74 Created: 02/01/2008 08:33:04		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         Accounting  Definition         An information system that identifies, records, and communicates  Term         Balance Sheet Definition         A financial statement that reports the assets, liabilities, and stockholders' equity at a specific date  Term         Accounting Equation  Definition         Assets = Liabilities + Stockholders' Equity        Term         Asset  Definition         Resources owned by a business  Term         Common Stock Definition         The total amount paid in by stockholders          Term         Corporation  Definition         A business organized as a separate legal entity under state corporation law having ownership divided into transferable shares of stock  Term         Dividends  Definition         A distribution by a corporation to its stockholders on an equal basis  Term         Expense  Definition         The cost of assets consumed or services used in the process of earning revenue  Term         FASB  Definition         Financial Accounting Standards Board A private organization that establishes generally accepted accounting principles  Term         Financial Accounting  Definition         The field of accounting that provides economic and financial information for investors, creditors, and other external users  Term         Net Income  Definition         The amount by which revenues exceed expenses  Term         Income Statement  Definition         A financial statement that presents the revenues and expenses and resulting net income or net loss of a company for a specific period of time  Term         GAAP  Definition         Generally Accepted Accounting Principles Common standards that indicate how to report economic events  Term         Liability  Definition         Creditorship claims on total assets  Term         Management Accounting  Definition         The field of accounting that provides economic and financial information for managers and other internal users  Term         Net Loss  Definition         The amount by which expenses exceed revenues  Term         Paid-In Capital  Definition         The total amount paid in by stockholders  Term         Partnership  Definition         An association of two or more persons to carry on as co-owners of a business for profit  Term         Proprietorship  Definition         A business owned by one person  Term         Retained Earnings  Definition         Revenues/Expenses/Dividends  Term         Revenues  Definition         The gross increase in stockholders' equity resulting from business activities entered into for the purpose of earning income  Term         Transaction Definition         The economic event of the enterprise that is recorded by accountants  Term         Statement of Retained Earnings  Definition         A financial statement that summarizes that changes in retained earnings for a specific period of time  Term         Statement of Cash Flows  Definition         A financial statement that provides information about the cash inflows and cash outflows of an entity for a specific period of time  Term         Stockholders' Equity  Definition         The ownership claim on total assets of a corporation  Term         Account  Definition         A record of increases and decreases in specific asset, liability, or stockholders' equity items  Term         Chart of Accounts  Definition         A list of accounts and the account numbers that identify their location in the ledger  Term         Compound Entry  Definition         A journal entry that involves three or more accounts  Term         Credit  Definition         The right side of an account  Term         Debit  Definition         The left side of an account  Term         Double-entry system  Definition         A system that records in appropriate accounts the dual effect of each transaction  Term         General Journal  Definition         The most basic form of journal  Term         General Ledger  Definition         A ledger that contains all asset, liability, and stockholders' equity accounts  Term         Journal  Definition         An accounting record in which transactions are initially recorded in chronological order  Term         Journalizing  Definition         The entering of transaction data in the journal  Term         Ledger  Definition         The entire group of accounts maintained by a company  Term         Normal Balance  Definition         The side (credit/debit) the account is normally on  Term         Posting  Definition         The procedure of transferring journal entries to the ledger accounts  Term         Posting Reference  Definition         The number associated with each account on the journal/ledger  Term         T-Account  Definition         The basic form of an account  Term         Trial Balance  Definition         A list of accounts and their balances at a given time  Term         Accrual Basis Accounting  Definition         Accounting basis in which transactions that change a company's financial statements are recorded in the periods in which the events occur  Term         Accrued Expense  Definition         Expenses incurred but not yet paid in cash or recorded  Term         Accrued Revenue  Definition         Revenues earned but not yet received in cash or recorded  Term         Accumulated Depreciation  Definition         A contra asset that goes along with certain assets such as equipment, etc.  Term         Adjusted Trial Balance  Definition         A list of accounts and their balances after all adjustments have been made  Term         Adjusting Entries  Definition         Entries made at the end of an accounting period to ensure that the revenue recognition and matching principles are followed  Term         Book Value  Definition         The difference between the cost of a depreciable asset and its related accumulated depreciation  Term         Calender Year  Definition         An accounting period that extends from January 1 to December 31  Term         Cash Basis Accounting  Definition         Accounting basis in which revenue is recorded when cash is received and an expense is recorded when cash is paid  Term         Contra Asset  Definition         An account that is offset against an asset account on the balance sheet  Term         Depreciation Definition          The allocation of the cost of an asset to expense over its useful life in a rational and systematic manner Term         Fiscal Year  Definition         An accounting period that is one year in length  Term         Interim Period  Definition         Monthly or quarterly accounting time periods  Term         Prepaid Expenses  Definition         Expenses paid in cash and recorded as assets before they are used or consumed  Term         Unearned Revenues  Definition         Cash received and recorded as liabilities before revenue is earned  Term         Useful Life  Definition         The length of service of a productive facility  Term         Classified Balance Sheet  Definition         A balance sheet that contains a number of standard classifications or sections  Term         Closing The Books  Definition         Zeroing out all temporary accounts for the start of the next fiscal year  Term         Closing Entries  Definition         Entries made at the end of an accounting period to transfer the balances of temporary accounts to a permanent stockholders' equity account, Retained Earnings  Term         Correcting Entries  Definition         Entries to correct errors made in recording transactions  Term         Current Assest  Definition         Cash and other resources that are reasonably expected to be realized in cash or sold or consumed in the business within one year of the operating cycle, whichever is longer  Term         Current Liability  Definition         Obligations reasonably expected to be paid from existing current assets or through the creation of other current liabilities within the next year or operating cycle, whichever is longer  Term         Income Summary  Definition         A temporary account used in closing revenue and expense accounts  Term         Intangible Assets  Definition         Noncurrent resources that do not have physical substance  Term         Liquidity  Definition         The ability of a company to pay obligations that are expected to become due within the next year or operating cycle  Term         Long-term Investments  Definition          Resources not expected to be realized in cash within the next year or operating cycle Term         Operating Cycle  Definition         The average time required to go from cash to cash in producing revenues  Term         Permanant (Real) Accounts  Definition          Balance sheet accounts whose balances are carried forward to the next accounting period Term         Post-closing Trial Balance  Definition         A list of permanent accounts and their balances after closing entries have been journalized and posted  Term         Property, Plant, and Equipment  Definition         Assets of a relatively permanent nature that are being used in the business and not intended for sale  Term         Reversing Entry  Definition         An entry made at the beginning of the next accounting period that is the exact opposite of the adjustment entry made in the previous period  Term         Stockholders' Equity  Definition         The ownership claim of shareholders on total assets as represented by common stock and retained earninigs  Term         Temporary (Nominal) Accounts  Definition         Revenue, expense, and dividend accounts whose balances are transferred to retained earnings at the end of an accounting period