1
If a company's total revenue of $7,000 is less than its total expenses of $10,000, the difference of $3,000 is
Net Loss
An accountant who has passed the uniform CPA exam and met the state's licensing requirements
Certified Public Accountant
If a company's total revenue of $10,000 is greater than its total expenses of $7,000, the difference of $3,000 is
Net Income
A business decides to summarize its financial performance every three months (a quarter). This three-month span is a
Fiscal Period
A company provides a service in December but won't receive the $500 cash payment until January. Under the ______, the $500 is counted as revenue in December when it was earned.
Accrual Basis of Accounting
A business uses the 12 consecutive months from January 1 to December 31 to summarize its financial information. This 12-month period is a
Fiscal Year
The accountant totals all the debit balances and all the credit balances in the general ledger. If both totals equal $50,000, that proves the equality of debits and credits, which is the
Trial Balance
Assets= Liability + OE
Accounting Equation
A company pays $1,200 for a one-year insurance policy on December 1. Since the expense is not used up until later periods, the initial payment is a
Prepaid Expense
At the end of the year, the accountant records the change to show that $100 of the prepaid insurance was used up. This update is an
Adjustments
Before preparing the formal reports, the accountant uses a multi-column spreadsheet to gather and summarize all the general ledger balances and proposed adjustments. This spreadsheet is the
Work sheet
A report for the month of December that shows the company had $10,000 in sales revenue and $7,000 in total expenses.
Income Statement
A report generated on December 31 that shows the company has $10,000 in cash (asset), $3,000 in loans (liability), and $7,000 in owner's equity on that specific date.
Balance Sheet
The journal entry that the accountant records to formally transfer the adjustment from the work sheet into the general ledger accounts.
Adjusting Entries
A company provides a service in December but won't receive the $500 cash payment until January. Under the _____, the $500 is counted as revenue in January when the cash is received.
Cash Basis of Accounting