Lecture 6 - Accounting Cycle Flashcards

1
Q

Accounting cycle

A

sequence of acct procedures used each period to record transactions and events and to prepare financial statements

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2
Q

Major Steps

A
Transaction occurs/source docs
journal entry
post (T-accounts)
Unadjusted trial balance
adjusting entries
adjusted trial balance
I/S
Close accounts
other financial statements
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3
Q

format of financial statements (heading)

A

Company name
name of financial statement
date

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4
Q

what happens to I/S accounts at end of period?

A

they are closed back into the retained earnings

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5
Q

Increases in RE =

A

revenues and gains

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6
Q

Decreases in RE =

A

expenses and losses

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7
Q

Close revenues

A

Debit Revenues

Credit RE

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8
Q

Close expenses

A

Debit RE

Credit expenses

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9
Q

I/S

A

Sales Rev
COGS
(other expenses)
= NI

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10
Q

Statement of RE

A

BB RE
NI
Dividends
= EB RE

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