Basic Info
Assets = Liabilities + Stockholders Equity
Tell me what is the expanded equation.
What is the Accounting Equation
Income Statement Balance Sheet Stockholders Equity Statment and Statement of Cash Flows
What is the Finacial Statement?
When cash is paid first to acquire an Assets and as time goes and the asset is being used you recognize expense
Give an example (Side-Quest)
What is a Prepaid Asset?
Because of Enron and World Com Congress Passed the Sarbanes-Oxley Act
What are Accounting Scandals?
Sales Discount, returns, and allowance. (Natural Debit account)
Explain: terms 2/10, n/30
What is a revenue contra account?
To Measure Business Activities and Communicate them to External Parties
What is Financial Accounting?
Rev-Exp
Define: Revenue and Expenses (Side-Quest)
What is an Income Statement?
When cash is given first to provide service later on
Where does it belong in the accounting equation (Side-Quest)
What is deferred Revenue?
Have a maturity date no longer than three months.
What are cash equivalents?
when a company thinks a client is not going to pay they used x debit account and x credit account
Tell me the accounts involved in a write off and write on (Side-Quest)
What is bad debt expense and allowance for uncollectible accounts?
Dividends, Expenses, Assets = Increase with Debit
Liabilities, Owners Equity, Revenue = Increase with Credit
Financial Position of the Company on a Particular Date
What is a Balance Sheet?
When you use a cost/asset/item that will be paid later on
Give an example (Side-quest)
What is Accrued Expense?
Established Preventive and Detective Controls that all Companies that are publically traded.
Give me an example of Preventive and Detective Controls (Side-Quest)
What is SOX Act?
LIFO, FIFO, Weighted Average
Explain each one of them and tell me the Inventory Formula(Side-Quest)
What are the three ways of calculating the COGS of Inventory?
Revenue should be recognized the day the service is performed
Expenses should be recognized the same period as the related revenue
What is Revenue/Expense Recognition Principle?
Common Stock + Retained Earnings (Beg Balance + Net Income - Dividends)
Define: Dividend
What is a Stockholder Equity Statement?
When you provide service and expect to receive cash later on.
Give an Example (Side-Quest)
What is Accrued Revenue?
The 4 subtotals are: Gross Profit, Operating Income, Income before taxes and Net income
Tell me: Formula to calculate Gross Profit
What is a Multistep Income Statement?
Purchase Discounts and Return
Tell me the accounts for the following transaction:
You buy on account $500 of pencils with the terms 2/10. You paid with in those those ten days
What is Contra Inventory Acc?
Acc Payable-500
Inventory- 10
Cash -490
Opportunity Motivation and Rationalization
Financing Activities + Investing Activities + Operating Activities
Define each Business Activity (Side-Quest)
What is the Statement of Cash Flows?
A contra account that affects Assets especially Equipment
What is Depreciation Expense?
The title/ownership passes when the seller ships the inventory
The title/ownership passes when the inventory reaches the buyer destination
Charges of shipping supplies from the supplier to the buyer
To what two accounts are effected by freight in charges in a perpetual inventory system (Side-quest)
What are FOB shipping point, destination, and Freight-in charges?
Transfer Temporary counts to retained earnings
What are the 3 temporary accounts and how do you close them?
What are closing entries?