Businesses
A legal entity that exchanges a product for money or money substitutes
What is a business?
A business that sells physical products to its customers.
What is a merchandise business?
The rules established by the accounting profession that govern financial accounting.
What are the generally accepted accounting principles? (GAAP)
Reports the amount of accumulated net profits a business has retained.
Wat is the statement of retained earnings?
The amount that someone is willing to pay for something
What is value?
A business entity with more than one owner where the owners are considered the same.
What is a partnership?
When a business acquires assets or services, they should be recorded at their actual cost.
What is the cost principle?
Reports the assets, liabilities, and stockholders' equity.
What is the balance sheet?
The revenue from a sale less the cost of the sale
What is revenue?
An owner of part of a business.
What is a stockholder?
Accounting that recognizes a business transaction when it occurs, whether or not cash is received.
What is accrual accounting?
Activities that generate revenue and/or expenses.
What are operating activities?
Money owed to lenders.
What are liabilities?
Reports the revenues and expenses of a business.
What is the income statement?
An economic resource that a business owns and can use to operate
What is an asset?