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business 1201 > FINAL EXAM: Ch 10 > Flashcards

FINAL EXAM: Ch 10 Flashcards

1
Q

the art of recording and summarizing in terms of money, transactions and interpreting the results there of

A

accounting

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2
Q

the amount of cash that goes out of the business because it is buying goods or services needed for its operations

A

expenses

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3
Q

Statement of the sum of goods or services provided

A

Invoices

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4
Q

a set of standards to measure, recognize, and present the information that appears in a business financial statements

A

Accounting Framework

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5
Q

US: GAAP

A

Generally Accepted Accounting Principles

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6
Q

IFRS

A

International Financial Reporting Standards

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7
Q

Involves the collection of financial info into external records, these records provide investors, banks, and others with selected info about the financial health of a company

A

Financial Accounting

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8
Q

Examines the financial statements and supporting accounting systems of clients

A

Public Accounting

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9
Q

Investigates and reconstructs financial information when there are no financial records available, this skills is needed when a business has committed fraud and the current counting system is not trustworthy.

A

Forensic Accounting

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10
Q

employs a distinctive accounting framework to create and manage funds, these funds serve to pay for expenses that a gov entity incurs and outlays to porvide its services

A

Governmental Accounting

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11
Q

involves identifying, measuring, analyzing and interpreting financial info, managers use this info so they can pursue the business goals.

A

Managerial accounting

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12
Q

focused on examining business procedures and transactions to identify internal controls, these controls are important to identify deficiencies, waste, fraud, and mismanagement so that the accounting systems can be improved

A

internal auditing

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13
Q

provides detailed info about assets, liabilities, and owners equity

A

balance sheets

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14
Q

resources owned by the business that hold intrinsic, quantificable value

A

assets

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15
Q

a debt that business owes to an external person or business

A

liablilities

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16
Q

the amount of money remaining if a business sold all its assets and pay off their liabilities

A

owners equity

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17
Q

Assets = Liabilities + owners Equity

A

Accounting equation

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18
Q

losing value over time

A

deprecation

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19
Q

profits that are not paid out and the owners invested back into the company

A

Retained Earnings

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20
Q

a financial document that presents a summary of the business’ sales, expenses gains or losses, and the resulting net income/net loss that happened in a period

A

Income Statement

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21
Q

inflows from selling goods and providing services, often used interchangeably with revenues

A

Net Sales

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22
Q

outflows that are result of running the business

A

Expenses

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23
Q

the expenses indirectly related to the business producing a good or providing a service, such as rent, utilities, insurance, and their overhead costs

A

General and Administrative expenses

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24
Q

Account for the reduction of value of an asset

A

Deprecation Expenses

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25
Q

the amount of money that remains from revenues after expenses are deducted

A

Income

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26
Q

The difference between net sales and cost of goods sold

A

Gross margin

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27
Q

the difference between gross margin and general administrative expenses including depreciation expenses

A

Operating Income

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28
Q

the difference between operating income and income taxes

A

net income

29
Q

income statements can also include one time items that are not included in the operating income because they are not directly from producing a good or provide services

A

Other items

30
Q

Increases in equity from transactions and other events

A

Gains

31
Q

Reductions in equity from transactions and other events

A

Losses

32
Q

Offers a detailed narrative of what happened to the business’ cash during a period

A

Cash Flow Statement

33
Q

Includes sources and uses of cash form business activities

A

Cash from operating activities

34
Q

Cash flow from buying or selling investments

A

Cash from investing activities

35
Q

Cash Flow used to fund the company

A

Cash from financing activities

36
Q

The money paid to the business shareholders

A

Dividends paid

37
Q

represents the money shareholders have deposited in the business as an investment

A

Capital Contributions

38
Q

measures liquidity, or cash flow, to reveal if the business has the current assets on-hand to cover its bills in a timely manner

A

Current Ratio

39
Q

measures the current assets that can be quickly converted to cash

A

quick ratio

40
Q

measures the amount of all debts and liabilities against owner’s equity

A

debt to equity ratio

41
Q

lets shareholders know how profitable their investments in the business is and its evaluates that investment’s returns

A

return on equity ratio

42
Q

a measure of how much net profit is generated compared to the amount of net sales

A

net profit margin ratio

43
Q

activities that are added to the operating procedures of a business or organization with the purpose of protecting assets

A

internal controls

44
Q

intended to minimize errors or irregularities from occurring and to ensure business objectives are met

A

preventive controls

45
Q

Intended to find errors or irregularities once they have occurred

A

Detective controls

46
Q

Internal controls are not infallible

A
47
Q

Are the amount of cash that goes out of the business because the business is buying goods or services needed for its operations

A

Expenses

48
Q

Accounting transactions always need to be stated in terms of____

A

Money

49
Q

____is the accounting framework used in the United States

A

Generally Accepted Accounting Principles (GAAP)

50
Q

____is the accounting framework outside the United States

A

IFRS

51
Q

_accounting investigates and reconstructs financial information when financial records are not available

A

Forensic

52
Q

The balance sheet provides detailed information about___

A

Assets, liabilities, and owner’s equity

53
Q

____ is the accounting equation

A

Assets=Liabilities+Owner’s Equity

54
Q

___are resources owned by the business that hold, intrinsic, quantifiable value

A

Assets

55
Q

the business liabilities, the sum of money a business owes, such as loans accounts payable, mortgages and rent

A

Funding

56
Q

The Accounting System Manages:

A

Expenses, Invoices, Funding

57
Q

show balance sheet, income statement, and cash flow statement

A

Financial Statements

58
Q

amount of extra money that a business pays for another company that exceeds the value of assets

A

Goodwll

59
Q

Expected to be paid within the next year

A

Current Liability

60
Q

Expected to be paid in more than one year

A

Non-current Liability

61
Q

expected to be used within a year and are typically used for the day-to day operation, such as cash and inventory

A

Current Assets

62
Q

long-term assets that are illiquid, it would take time to convert it to cash, (a building)

A

Non-current Assets

63
Q

would be used over a number of years, such as equipment

A

long-term assets

64
Q

owners, managers, and employees

A

Internal Audience

65
Q

Investors

A

External Audience

66
Q

expenses related to the business’ producing a good, such as purchased material and the labor used in production

A

Cost of Goods Sold

67
Q

money owed to the business by customers

A

Accounts receivable

68
Q

money the business owes to suppliers and vendors

A

Accounts payable

69
Q

use data from more than one financial statement

A

Combine Ratio

business 1201 (5 decks)

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