Accounting Documents & more
Business documents which evidence a transaction.
What is Source Documents?
Items which are intended to be consumed during the course of business.
What is Consumables?
Reduction in value of a fixed asset.
What is Depreciation?
Adjusting Entries are recorded At the End of the month.
What is AEAE?
This account is never included in an adjusting entry.
What is Cash account?
A document meant to be viewed only by the people working for an organization.
What is Internal Document?
The principle which requires us to adhere to GAAP, except when doing so would unreasonably expensive or unduly difficult. At the same time, any alternative treatment must not impact the financial statements or the decision-making process of the users of those statements.
What is Materiality Principle?
A 2-step process to correct an incorrect entry.
Step 1: Reverse the incorrect
Step 2: Record the entry properly
What is Correcting Entry?
Prepayments, Depreciation, Accruals.
What are the 3 categories of adjusting entries?
A report we use to ensure that the balance in our G/L accounts are accurate and complete.
What is Trial Balance?
Both the Unadjusted and Adjusted Trial Balances.
What are Internal Documents?
The GAAP principle which states that we must report costs that were incurred to help generate revenue in the same period as the revenue they helped to generate.
What is Matching Principle?
A trial balance which is prepared after it has been journalized and posted.
What is Adjusting Trial Balance?
These are always recorded on the last day of the accounting period.
What is Adjusting Entries?
The life of a business can be divided into equal accounting periods, like months or quarters.
What is Time Period Assumption?
The adjusting entries related to prepayments are required as the result of payments that occurred in a prior period. The adjusting entries related to the accruals category are required as the result of something that will happen in a future period-invoicing and payment.
What is Prepayments vs Accruals?
The GAAP Principle which states that when an organization has chosen one method of accounting for an item, it should apply that same treatment to all the similar items that follow.
What is Consistency Principle?
We like to believe that if we interact with new material 16 times, we're sure to create a super-strong connection to the material in our brain.
What is Student First Rule of 16?
An expense that's been incurred, but for which no invoice has been received and no payments have been made.
What is Accrued Expense?
The value of a fixed asset after deducting ALL of the depreciation that has accumulated up to that point in time.
What is Net Book Value?
A journal entry made to align the general ledger accounts with the expense and revenue recognition principles of accural-based accounting.
What is Adjusting Entries?
The new name we'll use for the trial balance which is prepared before adjusting entries are recorded.
What is Unadjusted Trial Balance?
Every depreciable asset has this.
What is a Corresponding Accumulated Depreciation account?
Revenue that's been earned but for which no invoice has been issued and no payment have been received.
What is Accrued Revenue?
Personal accounting, Business accounting, journalizing transactions, Posting transactions, Depreciation, Adjusting entries.
What are the modules we have covered so far :-)?