Term
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Definition
| formally reporting an economic item or event in the financial statements |
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Term
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Definition
| refers to collecting money, generally from the sale of products or services. |
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Term
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Definition
| recognizes revenues when cash is collected |
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Term
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Definition
| recognize revenues and expenses in the period in which they occur, regardless of when cash is collected or paid. GAAP |
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Term
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| describes an earnings events that is recognized before cash is exchanged. |
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Term
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Definition
| describes an earnings event that is recognized after cash had been exchanged. |
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Term
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Definition
| the issue of cash for stock |
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Term
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Definition
| work is completed and bills have been sent to clients but cash is not yet collected |
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Term
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Definition
| represents the amount of cash the company expects to collect in the future. |
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Term
| asset exchange transaction |
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Definition
| the collection of an account receivable. |
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Term
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Definition
| cash payment for salary. both the asset account Cash and the equity account Retained Earnings are affected. |
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Term
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Definition
| might either be an asset or expense |
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Term
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Definition
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| asset exchange transaction |
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Definition
| the purchase of supplies on account |
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Term
| claims exchange transactions |
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Definition
| recognizing expenses incurred on account. One claims account increases and another claims account decreases |
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Term
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Definition
| a liability account that represents a business's obligation to pay cash for the operating expenses sometime in the future. |
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Term
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Definition
| the entry to recognize the accrued interest. interests receivable and retained earnings are increased. |
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Term
| claims exchange transaction |
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Definition
| the liability account Unearned Revenue decreases and the equity account Ret. Ear. increases. |
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Term
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Definition
| an increase in assets or a decrease in liabilities that a company obtains by providing customers with goods or services. |
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Term
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Definition
| expenses that are recognized before cash is paid |
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Term
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Definition
| represents the amount of cash the company is obligated to pay the instructor in the future. |
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Term
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Definition
| decreases in assets or increases in liabilities that are experiences in the process of generating revenues. |
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Term
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Definition
follow one after the other from the time a business is formed until it is dissolved.
1. recording transactions
2. adjusting the accounts
3. preparing financial statements
4. closing the temporary accounts |
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Term
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Definition
| what balance sheets are sometimes called because their balances carry forward. |
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Term
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Definition
| used to capture accounting info for a single accounting cycle. includes revenue, expense, and dividend accounts |
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Term
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Definition
| afterward, every temporary amount has a balance of zero and the retained earnings account is updated to reflect the earning activities and dividend distributions that took place during the accounting period. |
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Term
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Definition
| to appropriately math expenses with revenues |
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Term
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Definition
| expenses that are matched with the period in which they are incurred |
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Term
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Definition
| guides accountants to select the alternative that produces the lowest amount of net income. |
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