Exam 1 Flashcards
The process of identifying, recording, and summarizing economic information and reporting it to decision makers.
Accounting
The field of accounting that serves external decision makers, such as stockholders, suppliers, banks and government agencies
Financial Accounting
The field of accounting that serves internal decision makers, such as top executives, department heads, college deans, hospital administrators, and people at other management levels within an organization
Management Accounting
A document prepared by management and distributed to current and potential investors to inform them about the company’s past performance and future prospects
Annual Report
A document that U.S. companies file annually with the Securities and Exchange Commission. It contains the companies’ financial statements.
Form 10-K
The government agency responsible for regulating capital markets in the United States
Securities and Exchange Commission (SEC)
A financial statement that shows the financial status of a business entity at a particular instant in time
Balance Sheet (Statement of Financial Position)
Assets= Liabilities + Owners’ Equity
Balance Sheet Equation
Economic resources that a company expects to help generate future cash inflows or help reduce future cash outflows
Assets
Economic obligations of the organization to outsiders, or claims against its assets by outsiders
Liabilities
Promissory notes that are evidence of a debt and state the terms of payment
Notes Payable
The owners’ claims on an organization’s assets, or total assets less total liabilities
Owner’s Equity
An organization or a section of an organization that stands apart from other organizations and individuals as a separate economic unit
Entity
Any event that affects the financial position of an entity and that an accountant can reliably record in money terms
Transaction
An asset that a company expects to use for more than one year
Long-lived Asset
