Class notes/ definitions / terms 01/06/09
Recording, classifying, & summarizing financial information, and interpreting the results.
Owner of a business
Assets, liabilities & owners equity are comprised of individual accounts like cash, loans payable, and capital.
Property that a business owns
Assets used in the business that were provided by the owner.
Debts owned by a business
Short term debts, owed for credit purposes
Companies and individuals to whom money is owed
Financial interest of an owner in a business
Assets = Liabilities + Owners Equity
Itemized lists of assets, liabilities and owners equity showing financial position of a business.
Business activities involving the exchange of 1 item of value for another.
increasing asset account
decreasing asset account
decreasing liability / owners equity account
increasing liability / owners equity account
when you receive cash you...
when you pay out cash you...
when you pay an expense you _____ the specific expense account
when you make a sale or receive money, you ______ the revenue /fees / sales account
Revenues / Sales / Fees
Donation / Investment ( what would you do to assets side?)
credit capital acct
Donation / invesment (What would you do to capital account?)
FOB SHIPPING POINT
Receiver must pay shipping costs
Supllier / Sender must pay shipping costs
statement of owners equity
intiial capital + additional capital (+ or -) net profit or net loss - withdrawals account
revenue exceeds expenses
expenses exceed revenue
addition of monies to a contra account
addition of merchandise to be sold results in a _____ to the related merchandise exp acct
a discount for purchase would result in a _______ to the purchases discount account
Accounts closed at the end of each period (ex: revenue., expense, drawing acct)