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44 terms

AR Computerized Accounting I Unit 2

STUDY
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Account
a record summarizing all the information pertaining to a single item in the accounting equation.
Account Balance
the amount in an account.
Account Number
The number assigned to an account.
Account Title
the name given to an account.
Accounting Cycle
The series of accounting activities included in recording financial information for a fiscal period.
Accounting Equation
An equation showing the relationship among assets, liabilities, and owner's equity.
Accounting Period Cycle Concept
changes in financial information are reported for a specific period of time in the form of financial statements.
Accounting Record
an organized summary of a business's financial activities.
Accounting System
a planned process for providing financial information that will be useful to management.
Adequate Disclosure Concept
financial statements that contain all information necessary to understand a business's financial condition.
Adjusting Entries
Journal entries recorded to update general ledger accounts at the end of a fiscal period.
Adjustments
changes recorded on a work sheet to update general ledger accounts at the end of a fiscal period.
Assets
Any items of value that you own.
Balance Sheet
a financial statement that reports assets, liabilities, and owner's equity on a specific date.
Business Entity Concept
financial information is recorded and reported separately from the owner's personal financial information.
Capital
the account used to summarize the owner's equity in a business.
Chart of Accounts
A list of accounts used by a business.
Closing Entries
Journal entries used to prepare temporary accounts for a new fiscal period.
Consistent Reporting Concept
the same accounting procedures are followed in the same way in each accounting period.
Correcting Entry
a journal entry made to correct an error in the ledger.
Credit
an entry to the right side of a T account.
Debit
An amount recorded on the left side of a T Account.
Equities
financial rights to the assets of a business.
File Maintenance
The procedure for arranging accounts in a general ledger, assigning account numbers, and keeping records current.
Fiscal Period
the length of time for which a business summarizes and reports financial information.
General Ledger
a ledger that contains all accounts needed to prepare financial statements.
Going Concern Concept
financial statements are prepared with the expectation that a business will remain in operation indefinitely.
Income Statement
a financial statement showing the revenue and expenses for a fiscal period.
Ledger
a group of accounts.
Liability
an amount owed by a business.
Matching Expenses With Revenue Concept
revenue from business activities and expenses associated with earning that revenue are recorded in the same accounting period.
Net Income
The difference between total revenue and total expenses when total revenue is greater.
Net Loss
The difference between total revenue and total expenses when total expenses are greater.
Objective Evidence Concept
a source document is prepared for each transaction.
Opening an Account
writing an account title and number on the heading of an account.
Owner's Equity
the amount remaining after the value of all liabilities is subtracted from the value of all assets.
Permanent Accounts
accounts used to accumulate information from one fiscal period to the next.
Post-Closing Trial Balance
A trial balance prepared after the closing entries are posted.
Posting
Transferring information from a journal entry to a ledger account.
Proprietorship
a business owned by one person.
Temporary Accounts
accounts used to accumulate information until it is transferred to the owner's capital account.
Transaction
a business activity that changes assets, liabilities, or owner's equity.
Trial Balance
a proof of the equality of debits and credits in a general ledger.
Work Sheet
A columnar accounting form used to summarize the general ledger information needed to prepare financial statements.