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Accounting > Intro to Accounting Vocabulary > Flashcards

Intro to Accounting Vocabulary Flashcards

1
Q

Sole Proprietorship

A

Business owned by one person, easy to set up

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2
Q

Partnership

A

A business owned by two or more people, profits must be shared

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3
Q

Skills

A

Activities you do well

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4
Q

Values

A

The principles you live by

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5
Q

Lifestyle

A

The way you use your time, energy, and reosurces

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6
Q

Personality

A

A set of unique qualities that makes us different from all other people.

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7
Q

Corporation

A

A business organization that is recognized by law to have a life of its own (stockholders), easy to transfer ownership

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8
Q

For-profit business

A

Operated to earn money for their owners.

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9
Q

CPA

A

Must pass a national test and meet specified experience and education to practice accounting.

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10
Q

Profit

A

The amount of money earned over and above the amount spent to keep the business oeprating.

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11
Q

Free enterprise system

A

People are free to produce the goods and services they choose.

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12
Q

Loss

A

Businesses that spend more money than they earn.

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13
Q

Entrepreneurs

A

People who transform ideas for products or services.

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14
Q

Manufacturing Business

A

Buys raw materials and transforms them into finished products through the use of labor and capital.

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15
Q

Merchandising Business

A

Buys finished products and resells them to individuals or other businesses.

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15
Q

Accountant

A

Handles a broad range if responsibilities, makes decisions, and prepares financial reports.

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16
Q

Personal interest tests

A

Tests that help you identify the things you like to do

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17
Q

Networking

A

A way to find out about particular careers by asking people to share information.

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18
Q

For- profit business

A

A business that operates to earn money for their owners.

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19
Q

Not-for-profit business

A

A business such as a charity or environmental organization.

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20
Q

Public accounting

A

A firm that provides accounting services to their clients.

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21
Q

Service business

A

Provides a needed service for a fee.

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22
Q

Charter

A

Gives a corporation certain rights and privileges.

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23
Q

Free enterprise system

A

Individuals are free to use their money as they wish.

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24
Q

Profit

A

The amount of money earned over and above the amount spent to keep the business operating.

25
Q

Loss

A

Business that spend more money than they earn.

26
Q

Entrepreneurs

A

Transform ideas for products or services into real-world businesses.

27
Q

Service Business

A

Provides a needed service for a fee.

Includes: Travel agencies, repair shops … etc

28
Q

Capital

A

Money supplies by investors,banks,or owners of a business,

29
Q

Merchandising Business

A

Buys finished products and resells them to individuals or other businesses.
Ex. Department stores, supermarkets

30
Q

Manufacturing Business

A

Buys raw materials, such as wood or iron and transforms them into finished products through the use of labor and capitals. It then sells the finished products to individuals or other businesses.

31
Q

Accounting System

A

Designed to collect,document,and report on financial transactions affecting the business.

32
Q

Manual Accounting System

A

The accounting information is processed by hand.

33
Q

Computerized Accounting System

A

The financial accounting information is recorded by entering it into a computer.

34
Q

Generally Accepted Accounting Principal “GAAP”

A

Provide a way to communicate financial information in a form understood by those interested in the operations and financial condition of a business.

35
Q

Financial Reports

A

Summarized information about the status of a business.

36
Q

Financial Accounting

A

Focuses on reporting information to external users.

37
Q

Management Accounting

A

Focuses on reporting information to management or internal users of accounting information.

38
Q

Business Entity

A

Exists independently of it’s owner’s personal holdings.

39
Q

Accounting Period

A

A period of time covered by an accounting report.

40
Q

Property

A

Anything of value that is owned or controlled.

41
Q

Creditor

A

Any person or business to which you owe money.

42
Q

Credit

A

When you buy property and agree to pay for it later.

43
Q

Equity

A

Financial claim to assets.

44
Q

Assets

A

Property or items of value owned by a business, normal balance is a debit, increases on the debit side, decreases on the credit side

45
Q

Investments

A

Are assets, generally long-term in nature,that are not intended to be converted to cash or to be used in the normal operations of the business in the next accounting period.

47
Q

Owner’s Equity

A

The Owner’s claims to the assets of the business, normal balance is a credit, increases on the credit side, decreases on the debit side

47
Q

Accounting Equation

A

ASSETS = LIABILITIES + OWNER’S EQUITY.

48
Q

Liabilities

A

The creditor’s claims to the assets of the business, normal balance is on the credit side, increases on the credit side, decreases on the debit side

49
Q

Business Transaction

A

An economic event that causes a change either an increase or decrease - in assets,liabilities, or owner’s equity.

50
Q

Account

A

Shows the balance for a specific item.

52
Q

Accounts Recievable

A

The total amount of money owed to a business.

Its an asset because it represents a claim to assets of other people or business. (Asset)

52
Q

On Account

A

When a Business buys an item on credit.

53
Q

Accounts Payable

A

The amount of money owed, or payable, to the creditors of a business. (Liability)

55
Q

Revenue

A

Income earned from the sale of goods and services, normal balance is a credit, increases on the credit side

56
Q

Expense

A

The price paid for goods or services used to operate a business, normal balance is a debit, increases on the debit side

57
Q

Withdrawal

A

When the owner takes cash or other assets from the business for personal use, normal balance is a debit, increases on the debit side

58
Q

Advantaage of a Sole Proprietorship

A

Easy to set up

59
Q

Accounting Assumptions

A

Accounting period, business entity, going concern

60
Q

Temporary Accounts

A

Withdrawals, Revenue, Expense, Income Summary (get closed to zero at the end of the accounting period)

61
Q

Permanent Accounts

A

Assets, Liabilities, Capital - accounts that continue from one period to another.

Accounting (4 decks)

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