Balance Sheet, Income Statement and Stockholders' Equity Flashcards

1
Q

What is the accounting equation?

A

assets = liabilities + equity

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2
Q

The accounting equation is the foundation for what financial statement?

A

balance sheet

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3
Q

How do you calculate net income?

A

revenue - expenses = net income

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4
Q

The net income equation is the foundation for what financial statement?

A

income statement

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5
Q

What are the two main umbrella categories for statement of stockholders’ equity?

A

contributed capital and retained earnings

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6
Q

What are the three types of cash flows included on the statement of cash flows?

A

operating cash flow, investing cash flow and financing cash flow (IN THAT ORDER!)

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7
Q

Which statement(s) is/are taken over a period of time?

A

cash flows, income statement and stockholders’ equity

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8
Q

Which statement(s) is/are taken at a point in time?

A

the balance sheet

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9
Q

cash goes in the __________ category

A

asset

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10
Q

accounts receivable goes in the __________ category

A

asset

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11
Q

inventories goes in the __________ category

A

asset

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12
Q

land goes in the __________ category

A

asset

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13
Q

equipment goes in the __________ category

A

asset

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14
Q

investments goes in the __________ category

A

asset

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15
Q

accounts payable goes in the __________ category

A

liabilities

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16
Q

salaries payable goes in the __________ category

A

liabilities

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17
Q

taxes payable goes in the __________ category

A

liabilities

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18
Q

unearned / deferred revenue goes in the __________ category

A

liabilities

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19
Q

notes payable goes in the __________ category

A

liabilities

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20
Q

long-term debt goes in the __________ category

A

liabilities

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21
Q

when something is paid for “on account,” it goes in the __________ category

A

liabilities

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22
Q

common stock goes in the __________ category

A

equity

23
Q

retained earnings goes in the __________ category

A

equity

24
Q

when something is a debit, it goes on the ________ side of the T-chart

A

left

25
Q

when something is a credit, it goes on the ________ side of the T-chart

A

right

26
Q

What is the order for things on an income statement?

A

revenue, COGS, gross profit, expenses, net income

27
Q

How do you calculate retained earnings?

A

retained earnings = (beginning retained earnings) + (net income) - (dividends)

28
Q

When it comes to the specific type of equity, common stock falls under ___________ ____________

A

contributed capital

29
Q

When it comes to the specific type of equity, additional paid-in capital falls under ___________ ____________

A

contributed capital

30
Q

When it comes to the specific type of equity, treasury stock falls under ___________ ____________

A

contributed capital

31
Q

Retained earnings is the same thing as __________ capital

A

earned

32
Q

Is cash a current or noncurrent asset?

A

current

33
Q

Are marketable securities a current or noncurrent asset?

A

current

34
Q

Are accounts receivable a current or noncurrent asset?

A

current

35
Q

Is inventory a current or noncurrent asset?

A

current

36
Q

Are investments a current or noncurrent asset?

A

noncurrent

37
Q

Is PPE (property, plant and equipment) a current or noncurrent asset?

A

noncurrent

38
Q

Liabilities are listed in order of __________.

A

maturity

39
Q

Assets are listed in order of __________.

A

liquidity (how easily they are converted into cash)

40
Q

Are accounts payable a current or noncurrent liability?

A

current

41
Q

Are accrued liabilities a current or noncurrent liability?

A

current

42
Q

Are short-term borrowings a current or noncurrent liability?

A

current

43
Q

Is deferred (or unearned) revenue a current or noncurrent liability?

A

current

44
Q

If a liability is current, then it is due __________.

A

within one year

45
Q

If a liability is noncurrent, then it is due ____________.

A

in 1+ years

46
Q

Is long-term debt a current or noncurrent liability?

A

noncurrent

47
Q

Liabilities are purchased “on ___________” or “on ____________”.

A

on account or on credit

48
Q

What is the set of standards and accepted practices for accounting in the United States called?

A

the GAAP (Generally Accepted Accounting Principles)

49
Q

marketable securities go in the ______ category

A

asset

50
Q

prepaid expenses go in the _______ category

A

asset

51
Q

accounts receivable goes in the _________ category

A

asset

52
Q

common stock, addtl. paid-in capital, and treasury stock are all this type of equity: ______________________

A

contributed capital

53
Q

accumulated depreciation is a _________ ___________

A

contra asset

54
Q

What is the difference between accumulated depreciation and depreciation expense?

A

Accumulated depreciation is the total accumulated depreciation since the beginning, and depreciation expense is just within that one period of measurement.