Chapter 2 Flashcards
1
Q
When recognizing expired assets, rent is?
A
a period cost, matched to the period it benefits
2
Q
When recognizing expired assets, equipment costs are?
A
a depreciation expense
3
Q
The income statement is really just?
A
a way of explaining changes between one balance sheet and another
4
Q
Revenue and expense accounts are nothing more than?
A
subdivisions of stockholders’ equity
5
Q
What is the purpose of income statements?
A
to summarize the volume of sales and the various expenses so we can measure income
6
Q
When recognizing expired assets, inventory costs are?
A
product costs
