ACCOUNTING Flashcards
The process of reporting, recording, interpreting, and summarizing financial transactions of any business entity.
A wider concept of bookkeeping.
ACCOUNTING
Part of accounting that involve processes like identifying, measuring, recording, and classifying the financial transactions.
BOOKKEEPING
Resources carrying economic value that an individual organization, or a country owns with an expectation if deriving benefit thereof.
ASSETS
A sum of money which is owed by a person or a company. They are payable by the company by way of its assets.
LIABILITIES
The shareholder’s equity held by companies.
OWNER’S EQUITY
Money owed to the business suppliers presented as liability on the company’s balance sheet.
ACCOUNTS PAYABLE
A promise of cash receipt from customers (debtors) to when the firm has made sales.
ACCOUNTS RECEIVABLE
A legal entity or an artificial person per the law.
CORPORATION
Data presenting the company’s assets, liability, and owner’s equity as on specific date (usually year end)
BALANCE SHEET
Business document provide financial date about an entity to the persons and organizations outside the business.
A structured representation of the financial position, financial performance, and cash flow of an entity.
FINANCIAL STATEMENT
Two Accounting Methods
ACCRUAL BASIS AND CASH BASIS
A statement in the form of a list of an entity’s revenues, expenses, and net income or net loss.
INCOME STATEMENT
Excess of total revenue over total expenses.
NET INCOME (NET PROFIT)
Excess of total expenses over total revenues.
NET LOSS
A particular event that affects the financial position of a particular entity.
TRANSACTIONS
Components of Financial Statements
STATMENT OF FINANCIAL POSITION, INCOME STATEMENT, STATEMENT OF CHANGES IN EQUITY, STATMENT OF CASH FLOW
Requires faithful representation of the effects of transactions, other events, and conditions.
FAIR PRESENTATION
Recognizes business revenue and matching expenses when they are generated.
ACCRUAL BASIS
Sometimes called netting. Net presentation of separate assets, liabilities, or income and expenses in the financial statements.
OFFSETTING
An entity shall present a complete set if financial statements at least annually.
REPORTING PERIOD
Gives a snapshot of a business’ asset, liabilities, and equity.
BALANCE SHEET
Accounting Equation
ASSET = LIABILITIES + EQUITY
Marketable Securities
CURRENT ASSET
Short-term investments
CURRENT ASSET
Accrued Revenue
CURRENT ASSET
Unused Supplies
CURRENT ASSET
Inventory
CURRENT ASSET
Prepaid Expense
CURRENT ASSET
Allowance for doubtful accounts (less)
CURRENT ASSET
Machinery
NON-CURRENT ASSET
Vehicles
NON-CURRENT ASSET
Other Income
NON-CURRENT ASSET
Leasehold Improvements
NON-CURRENT ASSET
Brand Equity
INTANGIBLE ASSETS
Government Grants
INTANGIBLE ASSETS
Accrued Expenses
CURRENT LIABILITIES
Accumulated Amortization (Less)
INTANGEBLE ASSET
Short-term loans
CURRENT LIABILITIES
Deferred Revenue
CURRENT LIABILITIES
Earned and Unearned Premiums
CURRENT LIABILITIES
Accrued Compensation and Benefits
CURRENT LIABILITIES
Short-term Lease
CURRENT LIABILITIES
Long-term Debts
NON-CURRENT LIABILITIES
Deferred Tax
NON-CURRENT LIABILITIES
Pension Fund Liability
NON-CURRENT LIABILITIES
Bonds Payable
NON-CURRENT LIABILITIES
Notes Payable
NON-CURRENT LIABILITIES
Bank Loan
NON-CURRENT LIABILITIES
Preferred Stock
SHAREHOLDER’S EQUITY
Debentures
NON-CURRENT LIABILITIES
Retained Earnings
SHAREHOLDER’S EQUITY
Share Capital
SHAREHOLDER’S EQUITY
Common Ordinary Equity
SHAREHOLDER’S EQUITY
Accumulated other Comprehensive Income
SHAREHOLDER’S EQUITY
Common Shares
SHAREHOLDER’S EQUITY
Preferred Shares
SHAREHOLDER’S EQUITY
Treasury Stock (less)
SHAREHOLDER’S EQUITY
Drawings (less)
SHAREHOLDER’S EQUITY
Due to shareholders
NON-CURRENT LIABILITIES
What is the normal balance of the Dividends account?
DEBIT
