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Intro to Financial Accounting CWI > Week 1 > Flashcards

Week 1 Flashcards

1
Q

Accounting is an information system that

A
  1. Measures business activities
  2. Processes the information into reports
  3. Communicates results to decision makers
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2
Q

What’s the difference between financial and managerial accounting

A

Financial provides information to external decision makers, managerial provides to internal decision makers

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3
Q

What is a CPA

A

Certified Public account

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4
Q

What is a CGMA

A

Chartered Global Management Accountant. Has advanced knowledge in finance, operation, strategy, and management.

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5
Q

What is a CMA

A

Certified Management Accountant, specialize in accounting a financial management knowledge

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6
Q

What is a CFP

A

Certified Financial Planner. Certified professionals who work with individuals on budgeting, retirement planning, and other personal goals.

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7
Q

What are 3 fields of accounting

A

Public, Private, Government

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8
Q

What is a creditor

A

Any business or individual to whom a business owes money

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9
Q

The process of examining data, identifying trends, and drawing conclusions

A

Data analytics

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10
Q

What is data visualization

A

The presentation of data, trends, and conclusions in graphical charts

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11
Q

A privately funded organization that oversees the creation and governance of accounting standards

A

FASB, Financial Accounting Standards Board.

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12
Q

U.S. governmental agency that oversees the U.S. financial markets.

A

SEC, Securities and Exchange Commission

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13
Q

The guidelines for accounting information are called

A

Generally Accepted Accounting Principles (GAAP)

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14
Q

Standards for firms who do significant business in other countries

A

IFRS, International Financial Reporting Standards

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15
Q

Who publishes the IFRS

A

International Accounting Standards Board

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16
Q

Describe the economic entity assumption

A

States an organization stands apart as it’s own economic entity.

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17
Q

States that acquired assets and services should be recorded at their actual cost and not fair value

A

Cost principle

18
Q

Represents the price that would be received if the asset was sold

A

Fair Value

19
Q

Assumes the entity will remain in operation for the foreseeable future

A

Going concern assumption

20
Q

The assumption that requires items on the financial statements to be measured in terms of monetary unit

A

monetary unit assumption

21
Q

Requires management to review internal controls

A

Sarbanes-Oxley Act (SOX)

22
Q

Monitors independent accountants who audit public firms

A

Public Company Accounting Oversight Board (PCAOB)

23
Q

What is the accounting equation

A

Assets = liabilities + equity

24
Q

an economic resource that is expected to benefit the business in the future and something the business owns or has control of

A

Asset

25
Q

Debts that are owed to creditors

A

Liabilities

26
Q

The owners claim to the asset

A

equity

27
Q

Represents the basic ownership of a corporation

A

Common stock

28
Q

Equity earned by profitable companies not distributed to stock holders

A

Retained earning

29
Q

A distribution of a corporation’s earning to stockholders

A

dividends

30
Q

How do you calculate equity

A

Common stock - dividends + revenue - expenses

31
Q

An event that can affect the financial position of the business and be measured

A

transaction

32
Q

Short term liability that will be paid in the future

A

Accounts payable

33
Q

What are the 3 steps to analyzing a transaction

A
  1. Identify the accounts and account types
  2. Decide if each account increases or decreases
  3. Determine if the accounting equation is in balance
34
Q

The right to receive cash in the future for goods or services performed

A

Accounts receivable

35
Q

Business documents that are used to communicate information needed to make business decisions.

A

Financial statements

36
Q

What are the four maind financial statements

A
  1. Income Statement
  2. Statement of retained earnings
  3. Balance Sheet
  4. Statement of cash flows
37
Q

Reports the net income/loss of the business for a specific time. Only includes revenues and expenses

A

income statement

38
Q

Reports how the company’s retained earnings balance changed for a specific period of time. May be included in the Statement of Stockholders equity

A

Statement of retained earnings

39
Q

Reports on the assets, liabilities and stockholders’ equity of the business as a of a specific date. Gives a snapshot of the health of the organization.

A

Balance Sheet

40
Q

Reports on a business’ cash receipts and cash payments for a specific period

A

Statement of cash flows

Intro to Financial Accounting CWI (11 decks)

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