View
- Term
- Definition
- Both Sides
Study
- All (32)
Shortcut Show
Next
Prev
Flip
ACCOUNTING 221: CHAPTER 1
market
|
a group of people or entities organized to exchange items of value
|
profit
|
the difference between cost and market value
|
earnings
|
shared with resource owners and converse agents whpo efficiently satisfy consumer preferences has high of this
|
financial resources
|
money
|
investors
|
provide financial resources in exchange for ownership interests in business . Owners expect business to return to them a share of the business income earned
|
creditors
|
lend financial resources to businesses. Instead of a share of business income, creditors expect business to repay borrowed resources at a future date
|
assets
|
resources controlled by a business
|
liquidation |
selling all of a companies assets in which sale proceeds are returned to investors and creditors
|
physical resources
|
natural resources
|
labor resources
|
intellectual and physical labor
|
accounting information external users need is provided by what type of accounting?
|
finanical (stakeholder, investors creditors)
|
accounting information needed by internal users ( stakeholders and managers, employers in a business) is provided by what type of accounting ?
|
managerial accouting
|
Financial Accounting Standards Board
|
privately funded organization with the primary authority for establishing accounting standards in the United States
|
GAAP
|
Generally Accepted Accounting Principles
|
Reporting Entities
|
The people or businesses accountants report on are called this.
|
financial statements
|
has ten elements : assets, liabilities, equity, contributed capital, revenue, expenses, distributions, and net income
|
accounting equation
|
Equality involving a company’s assets, liabilities, and equity;
Assets=Liabilities+Equity
|
retained earnings
|
portion of assets that has been provided by earnings activities and not returned as dividends
|
stockholders equity
|
common stock+ retained earnings
|
asset source transactions
|
increases total assets and total claims
|
ASSET SOURCE TRANSACTIONS
|
•increase the total amount of assets and increase the total amount of claims
|
asset exchange transactions
|
decrease one asset and increase another asset
|
asset use transactions
|
decrease total amount of assets and the total amount of claims
|
income statement
|
matches expenses with the revenue that occur when operating a business
|
net income
|
when revenues exceeds expenses
|
net loss
|
when expenses are greater than revenue
|
matching concept
|
practice of paring revenues with expenses on the income statement
|
statement of cash flows
|
explains how a company obtained and used cash during the accounting period
|
financing activities
|
obtaining cash(infow) from owners or paying cash (outflow) to owners (dividends)
|
investing activities
|
paying cash (outflow) to purchase long term assets or receiving cash (inflow) from selling long term assets
|
operating activities
|
receiving cash (inflow) from revenue and paying cash (outflow) for expenses
|
closing
|
the act of transferring the balances
|