Chapter 1
What in an asset?
Anything that is owned
Assets= Liabilities + Owners Equity is known as what?
Accounting Equation
True or False: The two steps for opening an account are writing the account title and recording the balance
False
True or False: The source document SALES INVOICE is abbreviated as "S" in a journal entry
False
The number assigned to an account is known as
Account Number
What is the process of planning, recording, analyzing, and interpreting financial information?
Accounting
A list of accounts used by a business is
Chart of Accounts
Write a blank endorsement
Signature
A ledger that contains all accounts needed to prepare financial statements is what?
General Ledger
True or False: The journal columns used to record receiving cash from sales are cash, debits, and credit
True
Net Worth can also be called...?
Equity
A T Account is defined as
An accounting device used to analyze transactions
The recording of debit and credit parts of a transaction is
Double Entry Accounting
Transferring information from a journal entry to a ledger account is known as
Posting
If a transaction has been improperly journalized and posted to the ledger, the incorrect journal entry should be fixed with this type of journal entry
Correcting Entry
GAAP stands for?
Generally Accepted Accounting Principles
The principles of right and wrong that guide an individual in making decision is known as
Ethics
Determining that the amount of cash agrees with the accounting records is known as
Proving Cash
An invoice used as a source document for recording a sale on account is
Sales Invoice
Assets taken from the business for the owners personal use is
Withdrawals
A formal written document that describes the nature of a business and how it will operate is?
Business Plan
The side of the account that is increased is known as the
Normal Balance
A business form ordering a bank to pay cash from a bank account
Check
A group of accounts is known as the
Ledger
The procedure for arranging accounts in a general ledger, assigning account numbers, and keeping records current is
File Maintenence