Income Statement
True of False: There will never be more than one revenue account on an Income Statement.
False
What can increase owner's equity?
Net Income
OR
Additional investment by the owner
True or False: The Balance Sheet is at a specific date and not over a certain period of time.
True
What does GAAP stand for?
Generally Accepted Accounting Principles
The area of accounting that focuses on reporting information to internal users.
Managerial Accounting
The sections of an Income Statement start with a Heading and the next section is ______________.
True or False: The Owner's Equity Statement reports information over a period of time.
True
The area of accounting which focuses on reporting information to external user.
Financial Accounting
Financial Statements contain all necessary information.
Full disclosure
OR
Adequate Disclosure
Financial Statements contain all necessary information
Adequate Disclosure
True or false: The Income Statement reports information at a specific point in time.
False
The Owner's Equity Statement is reconciliation of what account over time?
Capital
The one owner's equity account that is included on the Balance Sheet.
Capital
Reporting revenue when it is earned and expenses when they are incurred regardless of cash exchanging hands.
Accrual Basis of Accounting
Total Expenses Divided by Total Sales
Total Expenses Ratio
Work sheet
Drawings
The order of three main types of accounts on a Balance Sheet.
Assets, Liabilities, Owner's Equity (or capital)
Financial Statements are prepared with the expectation that a business will remain in operation indefinitely.
Going Concern
Reporting an amount on a financial statement as a % of another item on the same statement.
Vertical Analysis
An amount is written in _________________ on a financial statement if it is a negative amount.
Parenthesis
Beginning Capital + ___________ - Drawings = Ending Capital.
Net Income
What does the Balance Sheet prove?
The accounting equation
Revenue earned and the expenses incurrend to earn that revenue are reported in the same period.
Matching Principle
Net Income Divided by Total Sales
Net Income Ratio
or
Return on Sales