Accounting Book #5 Flashcards
Balance Sheet
A financial statement that reports assets, liabilities, and owner’s equity on a specific date.
Consistent Reporting
The same accounting concepts are applied the same way for each accounting period for as long as the business operates.
Fiscal Period
the length of the accounting cycle for which a business summarizes and reports financial information.
Income Statement
A financial statement that reports the revenue and expenses for a fiscal period.
Net
The amount remaining after all deductions have been made.
Net Income
The difference between total revenue and total expenses when total revenue is greater than total expenses.
Net Loss
The difference between total revenue and expenses when total expenses are greater than total revenue.
Ruling
Refers to drawing a line. A single line means the entries above are complete. A double line means the figures have been verified as correct.
Working Papers
Informal, informational papers provided by accountants to owners and managers.
Worksheet
A columnar accounting form used to summarize the general ledger information needed to prepare financial statements.
Adjustments
An adjustment is an amount that is added to or subtracted from an account balance to bring the balance up to date.
Matching Expenses with Revenue
All revenue and expenses associated with a business activity are to be recorded in the same accounting period.
Trial Balance
A proof of the equality of debits and credits in a general ledger.
