AccountingTest1

Question 2

information system that identifies, records, and communicates economic events

Answer 2

Accounting

Question 3

Resources a business owns

Answer 3

Assets

Question 4

what does a balance sheet consist of?

Answer 4

Assets, liabilities, and equity

Question 5

A part of accounting that involves only the recording of economic events

Answer 5

Bookkeeping

Question 6

Principle that states that companies should record assets at their cost

Answer 6

Cost Principle

Question 7

assumption that activities of entity be kept separate from personal activities

Answer 7

Economic Entity Assumption

Question 8

The cost of assets consumed or services used in process of earning revenue

Answer 8

Expenses

Question 9

Principle that states assets and liabilities should be reported at fair value

Answer 9

Fair Value Principle

Question 10

Common Standards that indicate how to report economic events

Answer 10

Generally accepted accounting principles

Question 11

What is the purpose of an income statement?

Answer 11

Present revenue and expenses and net income or loss for a specific period of time

Question 12

Creditors claims on total assets

Answer 12

Liabilities

Question 13

Assumption stating that companies include transactions that are expressed in money

Answer 13

Monetary unit assumption

Question 14

The amount by which revenues exeed expenses

Answer 14

Net income

Question 15

Gross increase in stockholders equity from business activities for making money

Answer 15

Revenues

Question 16

Law passed by Congress intended to reduce unethical behavior

Answer 16

Sarbanes oxley Act

Question 17

What is the ownership claim on a corportation?

Answer 17

Stockholders’ Equity

Question 18

The economic events of a business that are recorded by accountants

Answer 18

Transactions

Question 19

A record of increase and decreases in specific asset, liabilities, and equity items

Answer 19

Account

Question 20

A journal entry that involves 3 or more accounts

Answer 20

Compound entry

Question 21

A system that records in appropriate accounts the dual effect of each transaction

Answer 21

Double-entry system

Question 22

the most basic form of journal

Answer 22

general journal

Question 23

a ledger that contains all assets, liabilities, and equity accounts

Answer 23

General ledger

Question 24

an accounting record in which transactions are intially recorded in chronological order

Answer 24

journal

Question 25

the entering of transaction data in the journal

Answer 25

journalizing

Question 26

the entire group of accounts maintained bt a company

Answer 26

ledger

Question 27

the procedure of transferring journal entries to the ledger accounts

Answer 27

Posting

Question 28

net income that is kept in the business

Answer 28

Retained earnings

Question 29

a journal entry that involves only 2 accounts

Answer 29

Simple Entry

Question 30

The basic form of an account

Answer 30

T-Account

Question 31

A list of accounts and their balances at a given time

Answer 31

trial balance

Question 32

Recording transactions in the period in which events occur

Answer 32

Accrual-basis accounting

Question 33

Adjusting entries for either accrual revenues or expenses

Answer 33

Accruals

Question 34

Expenses incurred but not yet paid for

Answer 34

Accrual expenses

Question 35

Revenues for services performed but not yet paid for

Answer 35

Accrual revenues

Question 36

A list of accounts and balances that companies have made adjustments on

Answer 36

Adjusted trial balance

Question 37

Entries made at end of period to ensure companies follow revenue and expense recognition principles

Answer 37

Adjusting entries

Question 38

The difference between cost of depriciable asset and its accumulated depreciation

Answer 38

Book value

Question 39

Record revenue when they receive cash and an expense when they pay cash

Answer 39

Cash-basis accounting

Question 40

An account offset against an asset account on the balance sheet

Answer 40

Contra asset account

Question 41

adjusting entries for either prepaid expenses or unearned revenues

Answer 41

deferrals

Question 42

The allocation of the cost of an asset to expense over its useful life

Answer 42

Depreciation

Question 43

The principle that companies match efforts (expenses) with accomplishments (revenues)

Answer 43

Expense Recognition (matching) principle

Question 44

expenses paid in cash before used

Answer 44

prepaid expenses

Question 45

The principle that companies recognize revenue in the period in which performance is satisfied

Answer 45

Revenue recognition principle

Question 46

An assumption that accountants can divide economic life of business into artificial time periods

Answer 46

Time period assumptions

Question 47

cash received before services are performed

Answer 47

Unearned revenues