FinAcc

Define Assets

something a business owns or has control of

Name the 5 common assets

cash, accounts receivable,land,furniture, merchandise inventory

define liabilities

debts that are owed to creditors

current assets can be

converted to ash within one year

long term assets can be

converted to cash after one year

reports the net income or net loss of the business for a specific period

income statement

a snapshot that shows how assets are financed at a particular point in time

balance sheet

how does the income statement calculate the net income

revenues-expenses

what is shown in the statement of owners equity

the changes in equity during the period, including

- net income or net loss

- owner contributions or withdrawals.

where is net income/net loss calculated

income statement

what is the return on assets formula

net income/total assets

debt ratio is

total liabilities/total assets

Which financial statement is used to report cash receipts for services​ provided?

statement of cash flows

measures how efficiently a company is using its assets to generate profit

ROA

“personal transactions should not be recorded in the company's financial records” this is known as the

economic entity assumption

list of all accounts in numerical order is known as the

chart of accounts

a detailed record of all increases and decreases that have occurred in an individual​ asset, liability, or equity during a specific period is defined as?

an account

The amount of cash on the trial balance is the amount of cash for the balance sheet.

True

False

true

what type of accounting is focused on providing information for external decision makers, such as investors, creditors, and regulators.

finincial accounting

Managerial accounting focuses on providing information for

internal decision makers such as managers and employees within the organization

The posting reference column in a four-column account (or any ledger format) is used to trace amounts from the journal to the ledger

false

a balance sheet shows

a snapshot of a business liabilitys, assets, and equity at a specific period in time

which statement shows if a business is profitable

income statement

what is the formula for Ending Owner’s Capital

Ending Owner’s Capital= (Beginning Owner’s Capital) + (Net Income) − (Withdrawals)

 The record holding all the accounts of a business, the changes in those accounts, and their balances

ledger

A journal entry that is characterized by having multiple debits and/or multiple credits

compound journal entry

 A record of transactions in date order

journal

Side of an account where increases are recorded

normal balance

Transferring amounts from the journal to the ledger

posting

 The process by which companies produce their financial statements for a specific period of time

 Accounting cycle

A list of all accounts with their balances at a point in time

trial balance

A list of all accounts with their account numbers

Chart of accounts

source document used to record the deposit of cash or checks into a bank account. I

bank deposit slip

Which of the following financial statements would be most useful if an analyst wants to know the likelihood of repayment of business​ debts?

balance sheet

What is assessed using the debt​ ratio?

risk of default

source document that provides the evidence and data for accounting​ transactions?

sales invoice