chapter 1-2
asset
anything of value that is owned
journalizing
recording transaction in a journal
bank statement
a report of deposits, withdrawls, and bank balances sent ot a depositor by a bank.
comparative financial statements
financial statements that provide information for multiple fiscal periods
liability
an amount owed
sales invoice
an invoice used as a source document for recording a sale on account
cash over
petty cash on hand amount that is more than the recorded amount.
financial accounting
the area of accounting that focuses on reporting information to external users
owners equity
the amount remaining after the value of all liabilities is subtracted from the value of all assets.
double entry accounting
the recording of debit and credit parts of a transaction
endorsement
a signature or stamp on the back of a check, transferring ownership
income statement
a financial statement showing the revenue and expenses for a fiscal period
accounts payable
amount to be paid in the future for goods or services already acquired.
ledger
a group of accounts
net income
the difference between total revenue and total expenses when total revenue is greater
a proof of the equality of debits and credits in a general ledger
accounts receivable
amounts to be received in the future due to the sale of goods or services.
receipt
a business form giving written acknowledgment for cash received.
balance sheet
a financial statement that reports the value of the business's assets, liabilities, and owner's equity on a specific date
statement of owners equity
report showing the difference between total liabilities vs total assets