Misc.
This is a list of all accounts used by a business.
What is a chart of accounts?
The basic accounting equation.
What is Assets = Liabilities + Equity
These are the items owned by a business that have monetary value.
What are assets?
When a business buys a computer with cash.
Debit Equipment , Credit Cash
This is what GAAP stands for
What are generally accepted accounting principles?
What are proprietorships, partnerships, and corporations.
This financial statement is prepared as of a specific date.
Balance Sheet
Income earned from the sale of goods or services.
What is revenue?
Debit Cash, Credit Stock
This principle states a company should only include transactions that can be expressed in terms of money.
What is the Monetary Unit Assumption?
A bank loan would be listed under this category on the balance sheet.
What is liabilities?
These are accounts that normally have debit balances.
What are Assets, expenses, and drawings?
This type of account refers to money owed by a company.
What is Account Payable?
You bought equipment on account. You are now paying it off.
Debit account payable, credit cash
This GAAP Principle states that accounting information should be based on the actual cost, not what you may forecast it to be worth.
What is the Cost Principle?
The term used to explain how quickly a company can convert assets into cash.
What is liquidity?
What is unearned revenue?
This type of account refers to money kept on hand.
What is petty cash?
A company buys equipment, partly in cash and plans to pay off the rest at a later date.
Debit equipment, credit cash and accounts payable.
This GAAP principle states that accounting for a business needs to be kept separate from the personal affairs of the owner.
What is the economic entity assumption?
This involves testing business records and procedures for accuracy.
What is auditing?
These two terms go hand in hand when discussing "artificial time periods" within accounting.
A company bought a vehicle a year ago. You are making an adjusting entry to reflect the depreciation.
Debit depreciation expense, credit accumulated depreciation
This paper friendly type of accounting is not in accordance with GAAP.
What is the cash basis of accounting?