Ch 1 - Accounting, The Lang of Bus VOCAB Flashcards
Define accounting. (8)
- process by which financial information about a business is recorded,
- classified
- summarized,
- interpreted, and
- communicated to
- owners,
- managers and
- other interested parties
Define accounting system. (3)
process designed to
- accumulate
- classify
- summarize financial data
Define auditing.
review of financial statements to assess their fairness and adherence to GAAP
Define auditor’s report.
independent accountant’s review of a firm’s financial statements
Define certified public accountant (CPA)
independent accountant who provides accounting services to public for a fee
Define corporation. (3)
- publicly or privately owned business entity that is separate from its owners and
- has a legal right to own property and do business in its own name
- stockholders are not responsible for debts or taxes of business
Define creditor.
one to whom money is owed
Define discussion memorandum.
explanation of a topic under considerations by Financial Accounting Standards Board
Define economic entity.
business or org whose major purpose is to produce a profit for its owners
Define entity. (5)
- anything having its own separate identity
- individual
- town
- university
- business
Define exposure draft.
proposed solution to a problem being considered by the Financial Accounting Standards Board
Define financial statements.
periodic reports of a firm’s financial position or operating results
Define generally accepted accounting principles (GAAP)
accounting standards developed and applied by professional accountants
Define governmental accounting.
accounting work preformed for a federal, state or local governmental unit
Define international accounting.
study of accounting principles used by different countries.
Define management advisory services.
services designed to help clients improve their information systems or their business performance
Define managerial accounting.
accounting work carried on by an accountant employed by a single business or industry
Define partnership.
business entity owned by two or more people who are legally responsible for the debts and taxes of the business
Define public accountants.
members of firms that perform accounting services for other companies
Define separate entity assumption.
concept of a keeping a firm’s financial records separate from the owner’s personal financial records
Define social entity.
a nonprofit org
Define sole proprietorship.
business entity owned by one person who is legally responsible for debts and taxes of the business
Define Statements of Financial Accounting Standards.
accounting principles established by the Financial Accounting Standards Board.
Define stock.
certificates that represents ownership of a corp
Define stockholders.
owners of a corp, also called shareholders
Define tax accounting.
service that involves tax compliance and tax planning
