Basic Accounting Concepts
This is the accounting equation that reflects the relationship between assets, liabilities, and equity.
What is Assets = Liabilities + Equity?
This person is a student gaining experience by helping the audit team with tasks
Who is an intern?
Companies hire this type of person to review their numbers and give confidence to banks and investors.
Who is an auditor?
This financial statement shows a company’s assets, liabilities, and equity.
What is the balance sheet
This tool is every accountant’s best friend and has been around since 1985.
What is Excel?
This is the term for money a company spends to run the business.
What are expenses?
This person performs substantive testing on key accounts (revenue, expenses, cash)
What is an audit associate?
Auditors must stay unbiased. This is called
What is independence?
Money a company earns from selling goods or services is called this.
What is revenue?
This person is a licensed accounting professional who passed a very difficult exam
Who is a CPA?
This is the method of accounting that records revenues and expenses when they happen, not when cash moves.
What is accrual accounting?
This person plans and oversees audit engagements and timelines
What is an audit manager?
This type of audit focuses on whether the financial statements follow the rules (GAAP).
What is a financial statement audit?
Items a company owns that have value, like cash or equipment, are called this.
What are assets?
This is the busiest time of year for auditors.
This is the term for the method of accounting that records revenues and expenses when they are incurred, regardless of when cash is exchanged.
What is Accrual Accounting?
This person checks the work of staff auditors and helps train them.
What is a senior audit associate?
This government board oversees audits of public companies.
What is the PCAOB?
This statement shows a company’s performance over a period of time.
What is the income statement?
The CPA exam isn't just one test - it's actually this many.
What is four?
This is a term for a company’s net income minus dividends paid to stockholders.
What is Retained Earnings?
This person is responsible for signing the audit opinion.
What is an audit principle?
This is the written conclusion auditors give at the end of the audit.
What is an audit opinion?
Debts or obligations a company owes are called this.
What are liabilities?
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What is True?