Accounting

Question 1

Accounting

Answer 1

A system generating quantitative information. Financial in nature. Intended to help people make economical decisions.

Question 2

Financial Accounting

Answer 2

Accounting made for External users: public information that anyone can access

Question 3

Types of Financial Statements

Answer 3

1. Balance Sheet
2. Income Statements
3. Statement of Cash Flow
4. Statement of Retained Earnings

Question 4

GAAP

Answer 4

Generally Accepted Accounting Principals

Question 5

Assets

Answer 5

Represents all of the economic resources that a company owns or control, and it will eventually be beneficial to the company in the future. (Ex: inventory, stocks)

Question 6

General Accounting Equation

Answer 6

Assets = Liabilities + Stockholders equity

Question 7

Liability

Answer 7

A companies obligation to pay cash, other assets or provide services in the future (DEBT) Ex: loans, taxes, credit cards

Question 8

what makes up stockholders equity

Answer 8

Common stock and retained earnnings

Question 9

Retained Earnings

Answer 9

All the profits your company has made minus the dividends

Question 10

Revenues

Answer 10

Net income in a companies assets from selling products or providing services.

Question 11

Equation for Net Income

Answer 11

Net Income= Revenues- Expenses

Question 12

Expenses

Answer 12

The resources that have been consumed in the process of generating revenues. If you haven’t generated any revenues even though you may have purchased something you don’t record it as an expense. Ex: labor, rent, utilites

Question 13

Balance of Retained Earnings Equations

Answer 13

Ending Balance of Retained Earnings= Beginning Balance of Retained Earning + Net Income -dividends

Question 14

Debit

Answer 14

Dr.
Expenses
Assets
Dividends
(Left side)

Question 15

Credit

Answer 15

Cr.
Liabilities
O.E (stockholders equity)
Revenues

Question 16

Temporary Accounts

Answer 16

Revenues
Expenses
Dividends
*Temporary Accounts need to be closed out!

Question 17

Permanent Accounts

Answer 17

Balance Sheets Accounts
(Assets, Liabilities, Stockholders Equity)

Question 18

Balance Sheet

Answer 18

Present at a certain date:
contain information pertaining assets, Liabilities, Stockholders’ Equity

Question 19

Statement of Income

Answer 19

Presented for a period of time–> will need a closing entry. Contains info about Revenue, Expenses, and Net Income

Question 20

Statement of Retained Earnings

Answer 20

Presented for a period of time–> will need a closing entry. Contains info about, Beginning balance of R.E Net Income, Dividends