Ch 5 - Adj and Worksheet VOCAB

Question 1

Define account form balance sheet.

Answer 1

1. Balance sheet that lists assets on the left, and owner’s equity and liabilities on the right

Question 2

Define adjusting entries (aka adjustments).

Answer 2

A Journal entries made to update accounts for items that were not rec recorded during the accounting period

Question 3

Define book value.

Answer 3

portion of an asset’s original cost that has not yet been depreciated

Question 4

Define contra account.

Answer 4

account with normal balance that is opposite that of a related account

Question 5

Define contra asset account

Answer 5

asset account with a credit balance, which is contrary to the normal balance of an asset account.

Question 6

Define depreciation.

Answer 6

allocation of the cost of a long-term asset to operations during its expected useful life.

Question 7

Define prepaid expenses.

Answer 7

expense items acquired, recorded, and paid for in advance of their use

Question 8

Define report form balance sheet.

Answer 8

balance sheet that lists the asset accounts first, followed by liabilities and owner’s equity.

Question 9

Define salvage value

Answer 9

estimate of the amount that could be received by selling or disposing of an asset at the end of its useful life

Question 10

Define straight-line depreciation.

Answer 10

allocation of an asset’s cost in equal amounts to each accounting period of the asset’s useful life

Question 11

Define worksheet

Answer 11

form used to gather all data needed at the end of an accounting period to prepare financial statements