Terms Flashcards
Refers to the standard frameworks of guidelines for financial accounting used in any given jurisdiction. I
GAAP
Refers to the process of planning, keeping, and interpreting financial records
accounting
Accounting
Bookkeepers
Accounting Clerks
General office clerks
Accounting job
A financial statement that reports assets, liabilities, and capital on specific date
Balance Sheet
Value that is owned
Asset
Financial right to the assets of a business
Equities
Amount owed by business
Liabilities
Value of owners equity
Capital
An equation showing the relationship among asset, liabilities and capital
Accounting Equation
Journal with two amount columns
General journal
A business paper from which information is obtain for a general journal entry
Source Document
A form in which a brief message is written describing an entry
Memorandum
A list of account tittles and numbers showing the location
Chart of account
A ledger that contains all account needed to prepare financial statement
General Ledger
An increase in capital resulting from the operation of the business
Revenue
A decrease in capital resulting from the operation of the business
Expense
A normal business activity that change asset, liabilities and owners equity
Transaction
A result in an increase in asset or a decrease in liabilities or capital
Debit
A result in an decrease in asset or a increase in liabilities or capital
Credit
The recording of debit and credit parts
Double entry accounting
A skeleton form of account showing only the debit and credit column
T- account
Account balance increase in the same column to its normal balance
Normal debit balance
Account balance decrease in the columns opposite to its normal balance
Normal credit balance
Recording business transactions in journal
Journalizing
A multi column journal in which transaction of a business maybe recorded
Combination Journal
Determining that the amount of cash on hand agrees with the accounting record
Proving cash
Process of copying summary level or detailed entries in an accounting journal into the general ledger
Posting
A column accounting firm on which, financial condition of a business is summarized
Worksheet
Changes recorded to update general ledger account at the end of a fiscal period
Adjustment
The difference between the total revenue and total expense when total revenue is greater
Net income
The difference between total revenue and total expense are greater.
Net loss
A financial statement showing the revenue and expense for a financial period.
Income Statement
Journal entries made to bring general ledger account up to date
Adjusting Entries
Journal entries used to prepare temporary capital accounts for a new fiscal period
Closing Entries
A trial balance prepared after the closing entries are posted
Post Closing trial balance
What is the accounting equation?
Asset= Liability + capital
Process of posting: steps
- Write the date in the date column of the general ledger amount
- Write the combination journal page number, in the post reference column
- Write the debit/ credit amount, in the right column
- Figure the new account balance
- Return to the combination journals post reference column
