ACCT 2113: EXAM 1
65 Cards in this Set
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purpose of closing entries
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-update balance in retained earning account to reflect transactions related to revenues, expenses and dividends in the current period
-reduce the balance of all revenue expense and dividend accounts to zero
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supply adjusting entry
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-decreases assets and stockhlder's equity; increases expense
-debit-supplies expense
-credit- supplies
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insurance adjusting enttry
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if prepaid: reduce amount for that month
-debit rent expense
-credit prepaid rent
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adjusting entry for salaries
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debit salaries expense
-credit salaries payable
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adjusting entry for unearned revenue
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-debit unearned revenue
-credit service revenue
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adjusting entry for prepaid advirtising
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debit advirtising expense
-credit prepaid advirtising
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adjusting entry for loan
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-debit interest expense
-credit interest payable
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cash-basis
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record revenues at time cash is received and expenses at time of payment
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accrual
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record at time of earnings in relation to the event
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asset transaction on common stock
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increase
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asset transaction on borrowing from bank
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increase
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asset transaction effect on purchasing equipment
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no effect
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asset transaction on purchasing supplies on account
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increase
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assset transaction on providing services to customers
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increase
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asset transaction effect on receiving cash in advance
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increase
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asset transaction effect on salary costs
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decrease
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asset transaction on paying dividends
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decrease
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stockholder's equity transaction effect on common stock
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increase
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stockholder's equity transaction effect on receiving money from bank
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increase
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stockholders equity transaction on purchasing equipment
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no effect
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stockholder's equity transaction effect on financing rent or supplies
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increase
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stockholders equity transaction effet on salaries
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decrease
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stockholder's equity transaction effect on paying dividends
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decrease
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bank balance reconciliation
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-deposits outstanding (+)
-checks outstand (-)
-banking errors
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company balance recongiliation
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-interest earned
-service fees
-NSF checks
-check received by bank
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DEALOR
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DEA - debit increase
LOR- debit decrease
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accounts receivable
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asset
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accumulated depriciation
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asset
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cash
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asset
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equipment
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asset
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interest receivable
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asset
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prepaid advirtising
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asset
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prepaid insurance
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asset
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prepaid rent
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asset
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supplies
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asset
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land
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asset
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accounts payable
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liability
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interest payable
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liability
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notes payable
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liability
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salaries ayabl
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liability
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income tax payable
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liability
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unearned revenue
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liability
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utilities payable
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liability
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common stock
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owner's equity
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retained earnings
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owner's equity
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Stockholder's equity
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owners equity
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interest revenue
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revenue
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membership revenue
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revenue
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service revenue
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revenue
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advirtising expense
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expense
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depriciation expense
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expense
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insurance expense
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expense
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research and development expense
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expense
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salaries expense
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expense
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service expense
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expense
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supplies expense
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expense
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utilities expense
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expense
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income statement
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revenue and expenses
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statement of stockholder's equity
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CS+RE
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finctions of financial accounting
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1. measure business activities of a company
2 communicate those measeurmetns to external parties for decision-making purposes
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balance sheet
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assets = liabilities +SE
-presents the financial position on a given day
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statement of cash flows
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measures the 3 categories of cash flow
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net income
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revenue and exense
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dividends
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represent payents of cash
- (old RE+net income)-new RE
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retained earnings
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amount of earnings not paid out in the form of dividends
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ACCT 2113: EXAM 1