FBLA - Accounting

Accounting period cycle

Changes in financial information are reported for a specific period of time in the form of financial statements

Adequate disclosure

Financial statements contain all information necessary to understand a business's financial condition

Business entity

Financial information is recorded and reported separately from the owner's personal financial information

Consistent reporting

The same accounting procedures are followed in the same way in each accounting period

Going concern

Financial statements are prepared with the expectation that a business will remain in operation indefinitely

Historical cost

The actual amount paid for merchandise or other items bought is recorded

Matching expenses with revenue

Revenue from business activities and expenses associated with earning that revenue are recorded in the same accounting period

Objective evidence

Revenue from business activities and expenses associated with earning that revenue are recorded in the same accounting period

Realization of revenue

Revenue is recorded at the time goods or services are sold

Unit of measurement

Business transactions are stated in numbers that have common values; that is, using a common unit of measurement

Account

A record summarizing all the information pertaining to a single item in the accounting equation

Account balance

The amount in an account

Account number

The number assigned to an account

Account title

The name given to an account

Accounting

Planning, recording, analyzing and interpreting financial information

Accounting cycle

The series of accounting activities included in recording financial information for a fiscal period

Accounting equation

An equation showing the relationship among assets, liabilities, and owner's equity

Accounting period

Fiscal period

Accounting records

Organized summaries of a business's financial activities

Accounting system

A planned process for providing financial information that will be useful for management

Accounts payable ledger

A subsidiary ledger containing only accounts for vendors from whom items are purchased or bought on account

Accounts receivable ledger

A subsidiary ledger containing only account for charge customers

Adjusting entries

Journal entries recorded to update general ledger accounts at the end of a fiscal period

Adjustments

Changes recorded on a work sheet to update general ledger accounts at the end of a fiscal period

Asset

Anything of value that is owned

Balance sheet

A financial statement that reports assets, liabilities, and owner's equity on a specific date

Bank statement

A report of deposits, withdrawals and bank balances sent to a depositor by a bank

Blank endorsement

An endorsement consisting only of the endorser's signature

Capital

The account used to summarize the owner's equity in a business

Cash payments journal

A specific journal used to record only cash payment transactions

Cash receipts journal

A specific journal used to record only cash receipt transactions

Cash sale

A sale in which cash is received for the total amount of the sale at the time of the transaction

Charge sale

Sale on account

Chart of accounts

A list of accounts used by a business

Check

A business form ordering a bank to pay cash from a bank account

Checking account

A bank account from which payments can be ordered by a depositor

Closing entries

Journal entries used to prepare temporary accounts for a new fiscal period

Component percentage

The percentage relationship between one financial statement item and the total that includes that item

Controlling account

An account in a general ledger that summarizes all accounts in a subsidiary ledger

Correcting entry

A journal entry made to correct an error in the ledger

Cost of goods sold

Cost of merchandise sold

Cost of merchandise

The price a business pays for goods it purchases to sell

Cost of merchandise sold

The total original price of all merchandise sold during a fiscal period

Credit

An amount recorded on the right side of a t account

Credit card sale

A sale in which a credit card is used for the total amount of the sale at the time of the transaction

Customer

A person or business to whom merchandise or services are sold

Debit

An amount recorded to the left side of a t account

Debit card

A bank card that, when making purchases, automatically deducts the amount of the purchase from the checking account of the cardholder

Dishonored check

A check that a bank refuses to pay

Distribution of net income statement

A partnership financial statement showing net income or loss distribution to partners

Double-entry accounting

The recording of debit and credit parts of a transaction

Electronic funds transfer

A computerized cash payments system that uses electronic impulses to transfer funds

Employee earnings record

A business form used to record details affecting payments made to an employee

Endorsement

A signature or stamp on the back of a check transferring ownership

Endorsement in full

Special endorsement

Entry

Information for each transaction recorded in a journal

Equities

Financial rights to the assets of a business

Exhibit

Supporting schedule

Expense

A decrease in owner's equity

Federal unemployment tax

A federal tax used for state and federal administrative expenses of the unemployment program

File maintenance

The procedure for arranging accounts in a general ledger, assigning account numbers, and keeping records current

Fiscal period

The length of time for which a business summarizes and reports financial information

General amount column

A journal amount column that is not headed with an account title

General journal

A journal with two amount columns in which all kinds of entries can be recorded

General ledger

A ledger that contains all accounts needs to prepare a financial statements

Gross earnings

Total earnings

Gross pay

Total earnings

Gross profit on sales

The revenue remaining after cost of merchandise sold has been deducted

Income statement

A financial statement showing the revenue and expenses for a fiscal period

Inventory

The amount of goods on hand

Invoice

A form describing the goods or services sold, the quantity and the price

Journal

A form for recording transactions in chronological order

Journalizing

Recording transactions in a journal

Ledger

A group of accounts

Liability

An amount owed by a business

Markup

The amount added to the cost of merchandise to establish the selling price

Medicare tax

A federal tax paid for hospital insurance

Memorandum

A form on which a brief message is written describing a transaction

Merchandise

Goods that a merchandising business purchases to sell

Merchandise inventory

The amount of goods on hand for sale to customers

Merchandising business

A business that purchases and sells goods

Net income

The difference between total revenue and total expenses when total revenue is greater

Net loss

The different between tots revenue and total expenses when total expenses is greater

Net pay

The total earnings paid to an employee after payroll taxes and other deductions

Nominal account

Temporary accounts

Normal balance

The side of the account that is increased

Opening an acocunt

Writing an account title and number on the heading of an account

Owner's equity

The amount remaining after the value of all liabilities is subtracted from the value of all assets

Owner's equity statement

A financial statement that summarizes the changes in owner's equity during a fiscal period

Partner

Each member of a partnership

Partnership

A business in which two or more persons combine their assets and skills

Pay period

The period covered by a salary payment

Payroll

The total amount earned by all employees for a pay period

Payroll register

A business form used to record payroll information

Payroll taxes

Taxes based on the payroll of a business

Permanent accounts

Accounts used to accumulate information from one fiscal period to the next

Petty cash

An amount of cash kept on hand and used for making small payments

Petty cash slip

A form showing proof of a petty cash payment

Post-closing trial balance

A trial balance prepared after the closing entries are posted

Postdated check

A check with a future date on it