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Statement of retained earnings

The financial statements most frequently provided include all of the following except.

Financial reporting

The process of determining how and at what cost money is allocated among competing interests.

Objective of financial reporting

To provide information about the reporting entity that is useful to investors, lenders, and other creditors for decision-making.

Monetary unit

The most effective means of expressing changes in capital and exchanges of goods and services.

Due process

The idea that the FASB operates in full view of the public and gives interested parties ample opportunity to make their views known.

FASB Accounting Standards Codification

The only authoritative accounting literature.

PCAOB

Public Company Accounting Oversight Board, which has oversight and enforcement authority and establishes auditing, quality control, and independence standards and rules.

GAAP

Generally Accepted Accounting Principles.

International accounting standards

The need for one set of international accounting standards relates to all of these choices being correct.

Neutrality

Means that a company should not select information to favor one set of interested parties over another.

Fair value

Defined by a company and requires market-based input for useful decision-making.

Adjusting entries

Made at the end of an accounting period to bring all accounts up to date on an accrual basis.

Retained Earnings

All of the following accounts are increased on the debit side except.

Closing entries

A required step in the accounting cycle.

Worksheet

Has columns for the income statement and balance sheet but cannot replace financial statements.

Deferrals

Include expenses paid in cash before used or consumed.

Adjusted trial balance

The financial statements are prepared from this trial balance.

Prepaid Insurance

Would have an amount in the debit column of a post-closing trial balance.

Cost of Goods Sold

When a merchandiser prepares closing entries, this is debited and Income Summary is credited.

Accrual basis adjustment

To convert cash receipts from customers to revenue, subtract ending Accounts Receivable.

Reversing entries

All deferrals for which a company debited or credited the original cash transaction should be reversed.

SEC

The primary governmental body that has influence over the FASB.

Faithful representation

Information represents the economic phenomena it purports to represent.

Confirmatory value

Information corrects past or present expectations.

Completeness

All necessary information is included.

Understandability

Information can be comprehended by users.

Two fundamental qualities of useful accounting info

Relevance and Faithful Representation.