Chapters 1-2
Anything of value that is owned.
What is an asset?
A business form ordering a bank to pay cash from a bank account.
An amount of cash kept on hand and used for making small payments.
What is petty cash?
The area of accounting that focuses on reporting information to internal users.
The series of accounting activities included in recording financial information for a fiscal period.
What is the accounting cycle?
The standards and rules that accountants follow while recording and reporting financial activities.
What is GAAP?
A form on which a brief message is written to describe a transaction.
What is a memorandum?
A check that a bank refuses to pay.
What is a dishonored check?
The calculation and interpretation of a financial ratio.
What is ratio analysis?
An account that reduces a related account on a financial statement.
What is a contra account?
A record summarizing all the information pertaining to a single item in the accounting equation.
The column in which an account number is placed as the last step in the posting procedure.
What is the Post. Ref. column?
A check dishonored by the bank because of insufficient funds in the account of the maker of the check.
What is a non-sufficient funds check?
Reporting an amount on a financial statement as a percentage of another item on the same financial statement.
What is vertical analysis?
Goods to be bought and sold.
What is merchandise?
The normal balance side of any revenue account .
What is credit side?
The number range in a chart of accounts in which expense accounts can be found.
What are the 500's?
A proof of the equality of debits and credits in a general ledger.
What is a trial balance?
A financial ratio is a comparison between ___ components of financial information.
A form requesting the purchase of merchandise.
What is requisition?
Financial reports that summarize the financial conditions and operations of a business.
What are financial statements?
The procedure of arranging accounts in a general ledger, assigning account numbers, and keeping records current.
What is file maintenance?
Reporting income when the cash is received and expenses when the cash is paid out.
What is cash basis of accounting?
____ accounts must start each fiscal period with a zero balance.
What are temporary accounts?
Income Summary is this type of account.
What is a temporary account?