ACCT 2010: EXAM 1
19 Cards in this Set
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Investing and credit decisions
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The primary focus for financial accounting information is to provide information useful for
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Assets = Liabilities + Owners' Equity
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The accounting equation is defined as
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Corporation
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The form of business organization that is legally separate from its owners is a
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Investing activity
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A company purchases a delivery truck to better serve its customers.
This purchase is classified as what type of activity?
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Limited liability
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Stockholders of a corporation are not obligated to pay the corporation's debts out of their own pocket.
What is this called?
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International Financial Reporting Standards
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IFRS stands for
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Beginning earnings -Dividends +Net income
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What is the formula for finding ending retained earnings balance?
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Income statement
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Revenues are shown in which statement?
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Going concern assumption
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The assumption that a business can continue to remain in operation into the future is the
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Unearned revenue
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Receiving cash from customers before services are performed results in
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Assets and Stockholders' equity
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Revenue increases what in the accounting equation
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Increase assets and increase liabilities
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Purchasing office supplies on account will
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Debit and Income Statement
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Expenses normally carry a _____ balance
and are shown in the ________
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Make it easier for investors to compare companies from different countries
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One motivation for reducing differences in accounting practices across countries is to
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Credit and Balance Sheet
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Liabilities normally carry a _____ balance
and are shown in the _________
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Debit accounts receivable and Credit service revenue
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If a company performs services to be billed to the customer, how would the transaction be recorded?
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Debit utilities expense Credit cash
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When a company pays utilities in cash the transaction is recorded as . . .
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Revenue Recognition Practices
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One item between US GAAP and IFRS that could change dramatically is
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Debit Cash Credit Unearned Revenue
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Chapter 1 Study Cards