acctg pt2 (intro to sfp)

studied byStudied by 0 people
0.0(0)
get a hint
hint

Accounting

1 / 126

encourage image

There's no tags or description

Looks like no one added any tags here yet for you.

127 Terms

1

Accounting

system designed to identify, collect, process, measure and communicate economic information about the business entity to those users having interest in the financial affairs of the entity

New cards
2

Accounting (accounting standards council)

is a service activity

New cards
3

Accounting (accounting standards council)

Its function is to provide quantitative information, primarily financial in nature, about finances, about economic entities, that is intended to be useful in making economic decision.

New cards
4

Accounting (committee on accounting terminology of the american institute of certified public accountants)

the art of recording, classifying and summarizing in a significant manner and in terms of money, transactions and events which are in part, at least, of a Financial character and interpreting the results thereof.

New cards
5

Accounting (american accounting association)

the method of recognizing, appraising and communicating economic details to permit informed judgment and decision by users of the information.

New cards
6

Statement of financial position

Also known as Balance sheet

New cards
7

Statement of financial position

It presents the financial position of an entity at a given date

New cards
8

As at, as of

The date of the statement of financial position is always “” or “” the end of the period

New cards
9

Assets, liabilities, and equity

SFP shows the company’s _____, _____, and ______

New cards
10

Debit and credit

SFP is divided into two parts

New cards
11

Liabilities

claims of creditors

New cards
12

Equity

claims of owners

New cards
13

Real accounts

The accounts in the balance sheet is called

New cards
14

Real accounts

accounts where their balances are carried forward into the next accounting period

New cards
15

Closing

Real accounts always have a _______ balance

New cards
16

Assets

What you “own”

New cards
17

Assets

Control and inflows

New cards
18

Debit

Normal balance of Assets

New cards
19

Assets

SFP balances start with ______

New cards
20

Assets

company resources that are expected to have future economic benefits

New cards
21

Liabilities

What you “owe”

New cards
22

Liabilities

No control and outflows

New cards
23

Liabilities

These are obligations of the company

New cards
24

Credit

Normal balance of Liabilities

New cards
25

Equity

What you “own” - What you “owe”

New cards
26

Equity

Residual Interest

New cards
27

Equity

the excess of assets over liabilities

New cards
28

Equity

the net assets of the business

New cards
29

Current assets

A type of asset wherein items listed on a company’s balance sheet that are expected to be converted into cash within one fiscal year (12 months of the transaction date)

New cards
30

Current assets

assets that are expected to be converted to cash or consumed within one year.

New cards
31

Noncurrent assets

A type of asset wherein long-term assets that a company expects to hold over one fiscal year (more than 12 months) that cannot be readily converted to cash within a year

New cards
32

Noncurrent assets

assets that are expected to be used for more than one year.

New cards
33

Cash, cash equivalents, account receivables, trading securities, inventories, supplies, and other prepaid assets

Examples of Current Assets (C, CE, AR, TS, I, S, and OPS)

New cards
34

Cash

Include bills and coins on hand, bank accounts, and operating funds

New cards
35

Cash

currency readily available to be used for the company's operations

New cards
36

Cash

It is any medium of exchange that a bank will accept for deposit at face value

New cards
37

Cash equivalents

Short-term, highly liquid investments that are readily convertible to known amounts of cash and which are subject to an insignificant risk of changes in value

New cards
38

Cash equivalents

technically not cash because it is not immediately available for use. It is almost cash in the sense that it will become cash within the next 90 days.

New cards
39

Cash equivalents

includes investment and treasury bills (t-bills)

New cards
40

Account receivables

Amounts owed by customers to the entity

New cards
41

Receivables

a general term that refers to the company's right to collect payment from third parties, such as customers and employees

New cards
42

Receivables

arise from contractual rights to receive cash or other assets from third parties.

New cards
43

Trade receivables

claims from suppliers from unpaid sales or services rendered in advance to customers

New cards
44

Trade receivables

came from the normal operating activities of the company. This is usually the largest receivables of an entity.

New cards
45

Discount

amount to be deducted in a customer payment

New cards
46

Discount period

a period where the customer could avail a discount

New cards
47

Notes receivables

Are evidenced by a promissory note

New cards
48

Promissory note

a piece of paper signed by the borrower where it promises to pay a certain amount at a certain time

New cards
49

Interest receivables

Are collectible amounts due to the cost of borrowing money

New cards
50

Trading securities

Securities that have been purchased by a company for the purposes of realizing a short term profit

New cards
51

Inventories

This balance sheet account represents cost of unsold merchandise

New cards
52

Inventories

company’s assets that are sold in the normal course of its business

New cards
53

Merchandise inventory

goods held for sale by the trading or merchandising company, account use in merchandising business (buy and sell)

New cards
54

Raw materials inventory

materials held for use in the production of finished foods of a manufacturing company

New cards
55

Goods in process inventory

materials in process in the production area but not yet finish

New cards
56

Finished goods inventory

finished product held for sale by the manufacturing company

New cards
57

Manufacturing business

from raw materials that will undergo the process  into finished products

New cards
58

Supplies

Those that are to be used in the day-to-day operations of the business such as Office supplies are not Inventories. It is classified as an asset called

New cards
59

Supplies and other prepaid assets

This include office supplies to be consumed by the business and prepaid assets.

New cards
60

Prepaid expenses

expenses not yet incurred but paid in advance

New cards
61

Property, plant, and equipment, intangibles, investment properties, biological assets, accumulated depreciation

Examples of Non-current Assets (PPE, IA, IP, BA)

New cards
62

Property, plant, and equipment

Include fixed assets used in the normal operating cycle or production of the business.

New cards
63

Property, plant, and equipment

Long term assets with physical substance

New cards
64

Fixed assets

old term of Property, plant, and equipment

New cards
65

Property, plant, and equipment

These assets are long-term assets that are used in the operations of the company

New cards
66

Land, building, equipment, land and building improvements, leasehold improvements

Examples of PPE are: (L, B, E, LBI, LI)

New cards
67

Land

real property used in operations or for rent. This is a fixed asset not subject to deprecation.

New cards
68

Building

real property used in operations such as warehouse and office buildings.

New cards
69

Equipment

this includes office computers, automobiles, delivery vehicle, and manufacturing equipment.

New cards
70

Land and building improvements

these are enhancements to land or building. Land improvements includes landscaping, parking lots and driveways. Building improvements includes floor and roof renovation.

New cards
71

Leasehold improvements

it’s like building improvements, except that the premise is just rented by the company.

New cards
72

Intangibles

an asset but without physical substance (e.g. trademarks, patent, copyright, goodwill)

New cards
73

investment properties

are long-lived assets not used in production

New cards
74

Biological assets

Are living plants or animals held by the business for resale or for breeding

New cards
75

Accumulated depreciation

Is a valuation account which represents the decrease in value of a fixed asset except for land due to continued use, wear and tear, passage of time and obsolescence

New cards
76

Current liabilities

Are obligations or debts of the business which will be settled within 12 months of the date on the balance sheet.

New cards
77

Noncurrent liabilities

Are obligations or debts of the business that will be due and payable beyond one year or 12 months

New cards
78

Accounts payable, notes payable, interest payable, other accrued expenses, income tax payable, unearned income

Examples of current liabilities

New cards
79

Accounts payable

Are open accounts relating to purchase of goods and/or raw materials

New cards
80

Notes payable

Are evidenced by a promissory note.

New cards
81

Other accrued expenses

These accounts pertain to expenses incurred but not yet paid.

New cards
82

Income tax payable

Business organization’s tax liability to the government where it operates

New cards
83

Unearned income

This represents income received in advance but not yet earned. In short, collection are already made but services are not yet rendered.

New cards
84

Notes payable, mortgage payable, loan payable, bonds payable

Examples of Noncurrent Liabilities

New cards
85

Notes payable

are issued promissory notes payable beyond one year

New cards
86

Mortgage payable

a long term liability account that refers to debt secured by a mortgage in real estate

New cards
87

Loan payable

an amount borrowed to the bank by the company payable beyond one year

New cards
88

Bonds payable

an amount obtain substantial sums of money from lenders to finance the acquisition of equipment and other needed assets, this obtain by issuing bonds

New cards
89

Trade payables

company obligations due to purchase of inventories or a requirement to pay the supplier

New cards
90

Equity

the owner’s capital in the business

New cards
91

Equity

the remaining amount or residual interest after deducting liabilities from the assets

New cards
92

Owner’s equity, partners’ equity, stockholders’ equity

Categories of equity

New cards
93

Owner’s equity

Equity For Sole Proprietorship

New cards
94

Partners’ equity

Equity For Partnership

New cards
95

Stockholders’ equity

Equity For Corporation

New cards
96

Capital

this is the account use to record the original and addition investment of the owner of the business entity

New cards
97

Withdrawal

when the owner of a business entity withdraws cash in or other assets, such as recorded in the drawing

New cards
98

Income and expense summary

it is a temporary account used at the end of the accounting period to close income and expenses. This account shows the profit or loss for the period before closing to the capital account

New cards
99

Expenses

Are the costs of operating the business

New cards
100

Cost of sales, cost of supplies used, salaries and wages, insurance, depreciation, taxes, bad debts

Examples of expenses

New cards

Explore top notes

note Note
studied byStudied by 7 people
Updated ... ago
5.0 Stars(1)
note Note
studied byStudied by 4 people
Updated ... ago
5.0 Stars(1)
note Note
studied byStudied by 9 people
Updated ... ago
5.0 Stars(1)
note Note
studied byStudied by 7 people
Updated ... ago
5.0 Stars(1)
note Note
studied byStudied by 15 people
Updated ... ago
5.0 Stars(1)
note Note
studied byStudied by 6 people
Updated ... ago
5.0 Stars(1)
note Note
studied byStudied by 13 people
Updated ... ago
5.0 Stars(1)
note Note
studied byStudied by 234 people
Updated ... ago
5.0 Stars(1)

Explore top flashcards

flashcards Flashcard87 terms
studied byStudied by 2 people
Updated ... ago
5.0 Stars(1)
flashcards Flashcard140 terms
studied byStudied by 4 people
Updated ... ago
5.0 Stars(1)
flashcards Flashcard51 terms
studied byStudied by 4 people
Updated ... ago
5.0 Stars(1)
flashcards Flashcard58 terms
studied byStudied by 4 people
Updated ... ago
5.0 Stars(2)
flashcards Flashcard44 terms
studied byStudied by 29 people
Updated ... ago
5.0 Stars(1)
flashcards Flashcard50 terms
studied byStudied by 14 people
Updated ... ago
5.0 Stars(1)
flashcards Flashcard107 terms
studied byStudied by 16 people
Updated ... ago
5.0 Stars(1)
flashcards Flashcard49 terms
studied byStudied by 353 people
Updated ... ago
5.0 Stars(2)