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16 terms

ACT 205 Midterm

STUDY
PLAY
what the company owns and uses to make revenue
assets
what the company owes and has to pay later on
liability
the money shareholders receive
common stock
what the company earns
revenue
the money it takes to make money
expenses
contains all the company's accounts, has a table of contents called a chart of accounts
ledger
What are the things used to demonstrate transactions?
T-accounts
What are the 9 steps in the accounting process?
Analyze transactions, Journalize, Post, Unadjusted Trial Balance, Adjusting Entries, Adjusted Trial Balance, prepare Financial Statements, Closing entries, Post-closing trial balance
What are the two questions to ask yourself when analyzing transactions?
What accounts are affected by this transaction? Are they increasing or decreasing?
What are the requirements when journalizing?
Every journal entry has a date. At least one account is debit, and at least one is credit.
What happens when you post?
Take the info from the journal and post it in the ledger.
What does the Revenue Recognition Principle say?
Revenue is recorded when it's earned.
The unadjusted trial balance is/isn't a financial statement.
isn't
When doing the unadjusted trial balance, list every account from the ledger except ___
income summary.
___ is linked to another account but does the opposite
contra account; ex: equipment vs. accumulated depreciation-equip.
What are the four financial statements in order?
Income Statement, Statement of Retained Earnings, Balance Sheet, Statement of Cash Flows