L02 - Part I - Financial Accounting

Question 1

What two groups of Accounts do you know?
Effekt on Balance sheet? (4)

Answer 1

POSITION

• Information on assets and liabilities
• have a opening balance from the the balance sheet

PERFORMANCE

• Information on revenues and expenses
• opening balance is 0

Question 2

What are the three main components (phases) in the accounting cycle? (3)

Answer 2

OPENING - Contains the position account (assets and the liabilities), at the beginning of the accounting periode.

RECORDING - Recorded Transactions during the year.

CLOSING - The balance of the accounts at the year end will be summarized in the

• a) balance sheet
• b) income statement

Question 3

What are common accounts for
Expenses? (5)

Answer 3

• Cost of sales
  __
• Salary / Wages
• Rent
• Engery
• Maintenance

Question 4

What are common accounts for
Revenues? (2)

Answer 4

• Sales revenue / Dividents
• Interest revenue

Question 5

What type of information does the balance sheet provide? (2)

• What is the typical order in which accounts are listed? (5)

Answer 5

It summarizes the fortune and the debts of a company, on a specific date.

Question 6

⭐ What is the purpose of the performance accounts…

• Opening: Balance sheet
• Closing: Income Statement
• Main Metrics, for Profit and Loss (3)

Answer 6

Balance sheet - opening balance zero, at the beginning of the period.

Income statement - summarizes expenses & revenues (profit/ loss), at closing date.

Question 7

Definition: Borrowings How is it reflected in the general journal?

Answer 7

Titeled Notes payable.

When a company borrows money. It normally signs a promissory note agreeing to pay the money back (including interest) hence, the little notes payable.

Question 8

What are some examples of asset accounts? (8)

Answer 8

Question 9

What are some examples of expense accounts? (8)

Answer 9

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Question 10

What are some examples of equity accounts? (2)

Answer 10