Vocabulary
business transaction
is always an exchange of things of value
decrease
15,000 + 3,000
18,000
what is a debtor?
a person or business that owes money or a debt to others
What is liquidity order?
the order in which current assets would likely be converted into cash
accounting period
is the period of time covered by financial statements
Paid 1000 cash to a creditor. Cash decreases and...
Accounts Payable decreases
1,500 + 21,000
22,500
What is the balance sheet equation?
A = L + OE
List the following items in order on a balance sheet
Cash
Office Supplies
Accounts Receivable
Cash
Accounts Receivable
Office Supplies
Accounting standards
are the principles, rules, and guidelines followed when preparing and presenting accounting information
Received 1500 cash from a customer. Cash increases and...
Accounts receivable decreases.
15,000 + 3,000 - 150
17,850
FREEBIE
FREEBIE
List the following items in order on a balance sheet:
Mortgage
Accounts Payable
Bank Loan
Accounts Payable
Bank Loan
Mortgage
public business
is listed on a stock exchange and is accountable to the public
The owner invested 2000 cash into the business. Cash increases and...
owner's equity increases.
2,000 - 150
1,850
what is a creditor?
a person or business that has extended credit or loaned money
Which item does not fit in?
cash
accounts payable
equipment
land
building
accounts payable
Fair Value Principle
uses the current fair market value of the assets for the financial reports
Bought a van for 20000, made down payment of 10000 cash and put the rest on credit. Equipment increases and...
cash decreases, and accounts payable increases
2,500 + 150 + 1,000 - 200
3,450
what is "capital"?
an owner's claim against the assets of a company after all liabilities are paid
What is the cost principle?
Cost principle means that assets are shown on the balance sheet at the cost of their acquisition or construction.