module 4 Flashcards
what is accounting?
The process of systematically collecting analyzing and reporting financial information
what is an audit?
an examination of a company’s financial statements in the accounting practices that produce them
what is GAAP?
GAAP= Generally Accepted Accounting Principles
an accepted set of guidelines and practices for US companies, reporting financial information and for accounting professional
what is managerial accounting?
provides managers and employees with the information needed to make decisions about a firms, financing, investing, marketing and operation activities
*used to manage a firm
what is financial accounting?
generates financial statements and reports for interested people outside an organization
- takes data and reports and releases it outside of the firm
what is the accounting equation?
assets= liabilities + owners equity
balance sheet
a financial statement **
A summary of the dollar amount
balance sheet
a financial statement **
A summary of the dollar amount
income statement
shows a companies, profit and loss expenses and where they came from
assets
The resources that a business owns
liabilities
A firm’s debts and obligations
owner’s equity
The difference between a firms assets and its liabilities
liquidity
how fast you can turn money into cash
current assets
Money💰 expected to liquidate within 12 months
current assets
Money💰 expected to liquidate within 12 months
