Claim against a debtor for an uncollected amount, generally from a completed transaction of sales or services rendered
What is an Accounts Receivable
100
Daily Double: What are nominal and real accounts and give examples?
Nominal Accounts: Accounts that close, such as revenue and expenses
Real Accounts: Accounts that do not close, such as equipment and bank
100
You as a business bought a car worth $2,000,000
DR Auto $2,000,000
CR Bank $2,000,000
100
The relationship of a company’s current assets that can be converted into cash to its current liabilities. It is determined by dividing QUICK ASSETS by current liabilities.
What is the Acid-Test Ratio
100
DR Bank $400
CR Revenue $400
You perform a "service" for cash (no paper trail :D)
200
You should try to match the revenue you are reporting with the expenses it took to generate that revenue in the same time period, or over the periods in which you will be receiving benefits from that expenditure.
What is the Matching Principle
200
This principle states that revenue must be recorded in the accounts at the same time the transaction is completed.
What is the Revenue Recognition Convention
200
A company has performed a service for you for $2 and you decide to pay them 4000 days later
CR AP $2
DR Expenses $2
200
Assets = Liabilities + ?
Owner's Equity
200
DR AR $4,000,000
CR Supplies $4,000,000
You sold some goodies and you are being payed at a later date.
300
The attempt to record the transactions and other events in the periods in which those transactions or events occur rather than only in the periods in which cash is received or paid by the business.
What is Accrual Accounting
300
The term for the depreciation of assets over a period of time.
What is Ammortization
300
You performed a service and recieved payment right away. You recieved $0.01
DR Bank $0.01
CR Revenue $0.01
300
Total Current Assets / Total Current Liabilities
What is a Current Ratio
300
DR Drawings $0.01
CR Bank $0.01
You withdrew $0.01
400
What is a listing of the accounts available in the accounting system in which to record entries
What is a chart of accounts
400
Periods that are less than one year called this.
What is an Interim Period
400
You go to a supplier and you buy some "assets" for $200 per ounce. You buy 20 ounces.
DR Supplies $4000
CR Bank $4000
400
(Net Income/Total Assets) x 100%
Profit Margin
400
CR Bank $536.76
DR Vehicle $475.00
DR HST $61.76
Repairs on a company vehicle cost $475 plus HST
500
Conventions, rules, and procedures necessary to define accepted accounting practice at a particular time.
What is GAAP
500
This states that a business will continue to operate unless it is known that it will not be able to
What is the Continuing Concern Concept
500
You sell some "supplies" for $200 per ounce. You sell 5 ounces and you are recieving payment at a later and more "safe" date.
DR AR $1000
CR Supplies $1000
500
(Net Income/Owners Equity) x 100%
Return on Equity
500
CR Revenue $670.00
CR HST Payable $87.10
DR Bank $757.10
A service was performed by the business for $670 plus HST