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Financial Accounting 7th ed Chapter 02 Glossary
for UoP XACC 291
20
Accounting
Undergraduate 1
02/03/2014

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Term
account
Definition
a record of increases and decreases in specific asset, liability, or stockholders' equity items. (p. 52)
Term
chart of accounts
Definition
a list of accounts and the account numbers that identify their location in the ledger. (p. 62)
Term
common stock
Definition
issued in exchange for the owners' investment paid to the corporation. (p. 54)
Term
compound entry
Definition
a journal entry that involves three of more accounts. (p. 59)
Term
credit
Definition
the right side of an account. (p. 53)
Term
debit
Definition
the left side of an account. (p. 53)
Term
dividend
Definition
a distribution by a corporation to its stockholders on a pro rata(equal) basis. (p. 55)
Term
double-entry system
Definition
a system that records in appropriate accounts the dual effect of each transaction. (p. 53)
Term
general journal
Definition
the most basic for of journal. (p. 58)
Term
general ledger
Definition
a ledger that contains all asset, liability, and stockholders' equity accounts. ((p. 60)
Term
journal
Definition
an accounting record in which transactions are initially recorded in chronological order. (p. 58)
Term
journalizing
Definition
the entering of transaction data in the journal, (p. 58)
Term
ledger
Definition
the entire group of accounts maintained by a company. (p. 60)
Term
normal balance
Definition
an account balance on the side where an increase in the account is recorded. (p. 54)
Term
posting
Definition
the transfer of journal entries to the ledger accounts. (p. 63)
Term
retained earnings
Definition
net income that is kept (retained) in the business. (p. 55)
Term
simple entry
Definition
a journal entry that involves only two accounts. (p. 59)
Term
T account
Definition
the basic form of an account. (p. 52)
Term
three-column form of account
Definition
a form with columns for debit, credit, and balance amounts in an account. (p. 71)
Term
trial balance
Definition
a list of accounts and their balances at a given time. (p. 71)
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