Elements and Components of Financial Statements Flashcards

Vocabulary-style flashcards defining the primary elements of financial statements and specific account types based on the 2018 FASB Revised Conceptual Framework.

Assets (General)

Resources owned by a company, which include items such as cash, inventories, supplies, and buildings.

Liabilities

Amounts owed to creditors, such as suppliers, workers, utility companies, and governments, which must be paid by a specified date.

Stockholders' Equity

The term used for a corporation to describe owners' claims to resources not owed to creditors.

Capital

The name for the owner's claim in a single proprietorship and partnership.

Real accounts

A classification for asset, liability, and equity accounts because their balances are carried over from one accounting period to another.

Revised Conceptual Framework

The framework released by FASB in March 2018 that introduced revised definitions for the elements of financial statements.

Equity

The residual interest in the assets of the entity after deducting all its liabilities.

Asset (Revised Definition)

A present economic resource controlled by the entity as a result of past events.

Economic resource

A right that has the potential to produce economic benefits.

Cash

A resource used to make purchases.

Inventories

Resources used to make product sales to customers.

Supplies

Resources used to perform basic business functions.

Buildings

Resources used by employees as a location from which to operate a company.