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_____ is called the language of business because it communicates data that help people make better decisions
What is Accounting?
Unearned Revenue is considered as a(n)
What is a Liability?
These are the concepts and rules that financial accounting is governed by.
What are Generally Accepted Accounting Principles (GAAP)?
These are the beliefs that separate right from wrong. They are accepted standards of good and bad behavior
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To show how successfully your business performed during a period of time, you would report its revenues and expenses in the
What is the Income Statement?
This financial statement is prepared first. It describes a company's revenues and expenses and computes net income or loss over a period of time
What is the income statement?
This organization is given the task of setting GAAP from the Securities and Exchange Commission (SEC)
What is the Financial Accounting Standards Board (FASB)?
What is the Revenue Recognition Principle?
The life of a company can be divided into time periods, such as months and years.
What is the Time Period Assumption?
These business organizations provides limited liability to its owners.
What is a Corporation and a Limited Liability Company (LLC)?
Dividends are reported on the _____.
What is the Statement of Retained Earnings?
What is the International Accounting Standards Board (IASB)?
A company records its expenses incurred to generate the revenue reported
What is the Expense Recognition Principle (aka Matching Principle)?
A business is accounted for separately from other business entities, including its owner
What is the Business Entity Assumption?
These three factors must exist for a person to commit fraud
What is Opportunity, Rationalization, and Pressure?
These are resources belonging to a company that have a future benefit to the company.
What is an Asset?
This form of business ownership burdens owners with the greatest risk of loss of their personal assets
What is a Sole Proprietorship?
Accounting information is based on actual cost. Actual cost is considered objective
What is the Measurement Principle (aka Cost Principle)?
Transactions and events are expressed in monetary, or money, units
What is the Monetary Unit Assumption?
This part of the FASB framework requires information to be relevant and faithful in its representation
What are Qualitative Characteristics?
The right to receive money in the future is called a(n)
What is an Account Receivable?
A business organized as a separate legal entity is a
What is a Corporation?
A company reports the details behind financial statements that would impact users' decisions in the notes to the financial statements
What is Full Disclosure Principle?
The business is presumed to continue operating instead of being closed or sold
What is the Going-Concern Assumption?