Building
a
Business
a
Business
a legal structure chosen by individuals or groups to conduct business activities. It determines how a business is taxed, how liability is handled, and the overall legal framework for operations.
What is Business Entity
What the company owns (e.g., cash, accounts receivable, equipment).
What is Assets
This report is an income statement that summarizes a company's financial performance over a specific period by comparing revenue against expenses to determine net profit or loss.
What is a Profit and Loss report or P&L Report
Sole Proprietorship need to file this tax form on their personal tax return
What is a Schedule C
An itemized document that records the products or services delivered to the customer, the total amount due, and the preferred payment method.
What is an Invoice
the simplest form of business structure, where a single individual owns and operates the business
Sole Proprietorship
What the company owes to others (e.g., accounts payable, loans payable).
What is Liabilities
The direct costs associated with producing the goods or services sold (e.g., raw materials, labor).
Cost of Goods Sold (COGS)
__________ accounting is a system where every financial transaction is recorded twice, once as a debit and once as a credit, ensuring the accounting equation (Assets = Liabilities + Equity) remains balanced.
What is Double -entry accounting
A document generated by the seller specifying the details about the product or services ordered by the customer. Along with the product and service details, sales order consists of price, quantity, terms, and conditions etc.
What is a Sales Order
This structure, while similar to a regular corporation, is specifically designed for organizations with a social or public benefit mission rather than profit generation for owners.
What is a Non Profit
The owner's stake in the company (e.g., retained earnings, contributed capital).
What is Owners Equity
This report is used to categorize and track all the financial transactions that affect a company's assets, liabilities, and owner's equity.
What is a Balance Sheet
_______ __ _______is a categorized list of all the financial accounts used by an organization to record transactions in its general ledger.
What is the Chart of Accounts (COA)
A ____ _____ is a signal of intent to buy, from a purchaser to a vendor, in the procurement process
What is a Purchase Order
List 4 common business entity types
What is sole proprietorships, partnerships, limited liability companies (LLCs), and corporations
the cost of doing business. This includes money spent and costs incurred while trying to generate revenue
What are Expenses
Cash flowing in and out from sales and expenses (operating activities), investments, and financing.
Statement of Cash Flow
the money that a company is owed by its customers for goods or services provided on credit.
What is Accounts Receivable (AR)
A document issued by a seller to a buyer as proof of a completed purchase, indicating that payment has been received for goods or services
What is a Sales Receipt
This business entity is considered "self employed" and file a Schedule SE to attach to their 1040 at the end of the year
What is a partnership
This is an accounting method where revenue is recognized when it's earned (when a product or service is delivered), and expenses are recognized when they are incurred (when a product or service is received), regardless of when cash is exchanged.
What is Accrual Basis Accounting
This report shows how long it takes customers to pay their invoices, identifying potential cash flow problems from slow-paying or delinquent accounts
Accounts Receivable Aging Reports
It is a common set of rules, standards, and procedures that U.S. companies must follow when preparing and reporting their financial statements.
What is (GAAP) Generally Accepted Accounting Principles
This is a type of IRS tax form used to report various types of non-employment income to the IRS
What is a 1099