Accounting Final Exam Pt 2

56 terms by M_Joseph_A

Create a new folder

Advertisement Upgrade to remove ads

Cumulative chapters 1-11 Matching

T account

A way of depicting the basic form of an account

Revenue

Gross increases in owners equity resulting from business activities

The revenue recognition principle dictates that revenue should be recognized in the accounting records

When it is earned

After a business transaction has been analyzed and entered in the book of original entry, the next step in the recording process is to transfer the information to

ledger accounts

Failure to prepare an adjusting entry at the end of the period to record an accrued expense would cause

an understatement of expenses and an understatement of liabilities.

Sources of increases to owners equity are

Additional investments by owners

Credits

Decrease assets and increase liabilities

If a company fails to make an adjusting entry to record supplies, then

expense will be understated

An unacceptable way to make a correcting entry is to

Erase the incorrect entry

The primary accounting standard setting body in the united states is the

Financial Accounting Standards Board

An accounting record where transactions are initially recorded in chronological order is called a

Journal

The process of entering an amount on the left side of an account is called

debit

Making an entry on the right side of an account is called

credit

After all closing entries have been journalized and posted, the final step in the accounting cycle is to prepare a ______ trail balance

Post closing

A twelve month accounting period

Fiscal year

Expenses paid before they are incurred

Prepaid expenses

Cost less accumulated depreciation

Book value

Divides the economic life of a business into artificial time periods

Time period assumption

Expenses are matched to revenues

Matching principle

A contra asset account

Accumulated depreciation

Recognition of revenue when it is recorded when earned

Revenue recognition principle

Revenues earned but not yet received

Accrued Revenues

Expenses incurred but not yet paid

Accrued Expenses

A cost allocation process

Depreciation

Cash discount

1/10 n/30

For most companies, the gross profit percentage

Changes little from year to year

Inventory held by a business is a _______ and when sold becomes a _____

Asset,Expense

The entry to record the sale of merchandise for cash includes a

Credit to sales revenue

The entry to record the return of $25 of inventory to a supplier under the perpetual inventory system is recorded with a debit to

purchase returns and credit inventory

If a purchaser returns goods purchased on account to the supplier under a perpetual inventory system, the purchaser would debit

accounts payable and credit inventory

The gross profit percentage is calculated as

gross profit divided by net sales revenue

Which accounts are affected in the closing process under a perpetual inventory system?

Cost of goods sold, sales returns and allowances, and sales discounts

Under the perpetual inventory system, the adjusting entry to account for inventory shrinkage would include a

credit to inventory

Ever subsidiary ledger must have its own

control account

customers individual accounts are included in a subsidiary ledger referred to as the

accounts receivable ledger

Assuming the use of special journals, the sales of merchandise to Jerri Blackwell on account would be recorded in the

general journal

A purchase of supplies for cash is recorded in the

cash payments journal

certified public accountants are expected to maintain higher standards than society in general

because their ability to attract business depends entirely upon their reputation

A _____ limits access to a local network

Firewall

Internal control over cash receipts is demonstrated by

a mailroom employee sending all customer checks to the treasurer who makes a bank deposit

The controller is responsible for

approving invoices for paymentq

Under the perpetual inventory system, the entry to record a sale on account would include a debit to

accounts receivable and a credit to sales revenue for the retail price of the inventory

The buyer is responsible for shipping costs when the shipping terms are

FOB shipping point

The system for electronic linkages that allows different computers to share the same information is

network

To update the inventory records for the sale of merchandise under a perpetual inventory system, the entry would include a

Debit to cost of goods sold

The three parties to a check are the

Maker, payer and bank

Gross profit minus operating expenses

Income from operations

A contra account to sales revenue

sales returns and allowances

Revenue that originates outside the main operations of a business

other revenue

A list of options for choosing computer functions

menu

Set of programs or instructions that cause the computer to perform the work desired

software

Devises that enable members of a local network to access the internet but keep nonmembers out of the network

firewall

expenses, other than cost of goods sold, that are incurred in the entity's major line of business

operating expenses

An accounting Journal designed to record one specific type of transaction

Special journal

Fund containing a small amount of cash that is used to pay minor expenditures

Petty cash

Gross profit divided by net sales revenue

Gross profit percentage

Please allow access to your computer’s microphone to use Voice Recording.

Having trouble? Click here for help.

We can’t access your microphone!

Click the icon above to update your browser permissions above and try again

Example:

Reload the page to try again!

Reload

Press Cmd-0 to reset your zoom

Press Ctrl-0 to reset your zoom

It looks like your browser might be zoomed in or out. Your browser needs to be zoomed to a normal size to record audio.

Please upgrade Flash or install Chrome
to use Voice Recording.

For more help, see our troubleshooting page.

Your microphone is muted

For help fixing this issue, see this FAQ.

Star this term

You can study starred terms together

NEW! Voice Recording

Create Set