Chap 3 Flashcards
1
Q
Assets
A
Assets are resources a business owns that are expected to provide future-benefits
2
Q
Liabilities
A
Liabilities are obligations owed by the business to others that are expected to be settled in future
3
Q
Equity
A
Claim by the owner on the net assets of the business
4
Q
Income
A
Amount earned through activities of the business
5
Q
Expenses
A
Costs incurred in the operation of a business to earn income in the same accounting period
6
Q
Basic accounting equation
A
Assets = Equity + Liabilities
7
Q
Expanded accounting equation
A
Assets = Liabilities + capital + income - drawings - expenses
