Items owned by a business that will provide future benefits.
What are Assets?
100
Assets = Liabilities + Owner's Equity
What is the Accounting Equation?
100
An individual, association, or organization that engages in economic activities and controls specific economic resources.
What is a business entity?
100
An economic event that has a direct impact on the business. Usually requires an exchange with an outside entity. Each and all of these affect the accounting equation through specific accounts.
What is a business transaction?
100
Purchased equipment for cash.
What is equipment increases, cash decreases?
200
Debts or obligations of the business that can be paid with cash, goods, or services.
What are Liabilities?
200
Includes three basic phrases: Input --> Processing --> Output
Example: Transactions --> Determination of what accounts were increased or decreased --> Summarization of results in Income Statement or Statement of Owner's Equity or Balance Sheet
What is the Accounting Process?
200
The amount of money owed to the business by its customers as a result of making sales "on account".
What is accounts receivable?
200
A separate record used to summarize changes in each asset, liability, and owner's equity of a business.
What is an account?
200
Paid this month's rent.
What is cash decreases, rent expense increase?
300
Amount by which the business assets exceed the business liabilities
What is Owner's Equity also called Net Worth or Capital?
300
Reports the profitability of business operations for a specific period of time. Expenses are subtracted from revenues to determine net income/loss.
What is the Income Statement?
300
An unwritten promise to pay a supplies for assets purchased or services rendered.
What is accounts payable?
300
In order to perform this function three questions must be answered: What happened? Which accounts are affected? and How is the accounting equation affected?
What is analyzing business transactions?
300
The end result of the following activities: Expenses exceeded income for the month.
What is net loss?
400
Examples include cash, merchandise, buildings, land, and accounts receivable.
What are Assets?
400
Reports the activities that affected owner's equity for a specific period of time.
What is the Statement of Owner's Equity?
400
Formal written promises to pay suppliers or lenders specified sums of money at definite future times.
What is notes payable?
400
After analysis and processing of a business transaction, the final step in the process.
What is determing if the accounting equation balances?
400
A month in which income exceeds withdrawals and expenses.
What is net income?
500
Examples include accounts payable and notes payable.
What are Liabilities?
500
Confirms the accounting equation has remained in balance.
What is the Balance Sheet?
500
Nonbusiness assets and liabilities are not included in the entity's accounting records. Personal assets and liabilities are not comingled with business assets and liabilities.
What is business entity concept?
500
The four types of business transactions that affect this account are: Expenses, Drawing, Revenues, and Investments.
What is Owner's Equity?
500
Service Company performed services for a client. The client will pay at a later date.