Terms
Definition - the difference between personal assets and personal liabilities.
What is equity
If two asset accounts are changed in a transaction, there must be an increase and a _____________.
What is a decrease.
Liabilities are on which side of the accounting equation?
What are the right side.
What is an expense
Total ____________ are the amount the owner has invested in the business.
What are ASSETS
What are financial statements
Identify which asset account(s) is affected with this transaction -
Paid cash for insurance, $6000.
What is Cash and Prepaid Insurance
State the accounting equation.
Assets = Liabilities + Owner's Equity
Financial rights to the assets of the business.
What are equities
Identify what classification supplies is.
What is an ASSET
Definition - the account used to summarize the owner's equity in the business.
What is capital account
Identify the affect on the asset account -
Sold services to Yardley Enterprises, $2,200.
What is - Cash account increases.
Identify the difference between a liability and an expense.
Liability is a debt that is owed
Expense is required for day to day operations of the business.
What is revenue
Identify what classification an expense is.
What is Owner's Equity
Definition - a business activity that changes assets, liabilities, or owner's equity.
what is transaction
A sale for which cash will be received at a later date is known as -
What is a sale on account
Identify the two accounts that are affected and how they are affected with the following transaction -
Paid cash on account to Yardley Enterprises, $759.
Cash - Decreases
Accts Payable, Yardley Enterprises - Decreases
The amount remaining after the value of all liabilities is subtracted from the value of all assets
What is owner's equity
GAAP stands for -
Definition - a formal report that shows what an individual owns, what an individual owes, and the difference between the two.
What is a net worth statement
Identify which accounts are affected and how they are affected with the following transaction -
Received cash on account from Yardley Enterprises, $1650.
Cash + 1650
Accts Receivable - 1650
Total Assets - Total Liabilities = Personal Net Worth
When the owner takes out assets for personal use, this is known as
What is withdrawals
Planning, recording, analyzing, and interpreting financial information is known as -
What is Accounting