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Chapter 4- Adjustments, Financial Statements, and the Qualit
n/a
13
Accounting
Undergraduate 1
09/20/2012

Additional Accounting Flashcards

 


 

Cards

Term
Accounting Cycle
Definition
  • is the process followed by entities to analyze and record transactions, adjust the records at the end of the period, prepare financial statements, and prepare the records for the next cycle. 
Term
Accrued Expenses
Definition
  •  are previously unrecorded expenses that need to be adjusted at the end of the accounting period to reflect the amount incurred and the related payable account. 
  • if cash will be paid
Term
Accrued Revenues
Definition
  •  are previously unrecorded revenues that need to be adjusted at the end of the accounting period to reflect the amount earned and the related receivable account. 
  • if cash will be received
Term
Adjusting Entries
Definition
  •  are entries necessary at the end of the accounting period to measure all revenues and expenses of that period. 
Term
Closing Entry
Definition
  • transfers balances in temporary accounts to Retained Earnings and establishes zero balances in temporary accounts.
Term
Contra-Account
Definition

 

  •  is an account that is an offset to, or reduction of, the primary account.

 

Term
Deferred Expenses
Definition
  •  are previously acquired assets that need to be adjusted at the end of the accounting period to reflect the amount of expense incurred in using the asset to generate revenue. 
  • if cash was paid and previously recorded
Term
Deferred (Unearned) Revenues
Definition
  • are previously recorded liabilities that need to be adjusted at the end of the accounting period to reflect the amount of revenue earned.
  • if cash was received and previously recorded
Term
Net Book Value (Book Value, Carrying Value)
Definition
  • [of an asset] is the difference between its acquisition cost and accumulated depreciation, its related contra-account.
Term
Permanent (Real) Accounts
Definition
  • are the balance sheet accounts that carry their ending balances into the next accounting period. 
Term
Post-Closing Trial Balance
Definition
  •  should be prepared as the last step of the accounting cycle to check that debits equal credits and all temporary accounts have been closed. 
Term
Temporary (Nominal) Accounts
Definition
  • are income statement accounts that are closed to Retained Earnings at the end of the accounting period. 
Term
Trial Balance
Definition
  • is a list of all accounts with their balances to provide a check on the equality of the debits and credits.
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