INCOME STATEMENT
FINANCIAL STATEMENTS
OWNER'S EQUITY
BALANCE SHEET
VOCABULARY/ CONCEPTS
100
The income statement of a proprietorship has two MAIN sections:
What is Revenue and Expenses
100
The financial statement that reports the business's profit or loss.
What is Income Statement?
100
If a business does not complete a worksheet, where do they get the numbers for their financial statements?
What is the general ledger
100
The mathematical equation that the balance sheet represents
What is A=L + OE
100
Any persons or group who will be affected by an action by the company
What is a stakeholder?
200
The heading of an income statement
What is Company Name, Income Statement, For Month Ended...
200
The financial statement that formally reports the accounting equation.
What is Balance Sheet?
200
The beginning capital is obtained from this.
What is a worksheet?
200
Three examples of Assets
What is Cash, Petty Cash, A/R, Supplies, Prepaid Insurance
200
Applied when financial statements contain all information necessary to understand a business's financial condition.
What is Adequate Disclosure?
300
Income Statement with two sources of Revenue differ how?
What is both revenue are listed in the "detail" column and totaled in the summary column.
300
Revenue must be large enough to
What is Cover Expenses and the desired amount of Net Income.
300
The temporary accounts that affect capital.
What is Revenue, Expenses and Drawing
300
The two sources of information that is obtained from for the balance sheet
What is Balance Sheet columns of the worksheet and the Calculation of Capital?
300
The same accounting procedures are followed in the same way in each accounting period.
What is Consistent Reporting?
400
Calculation for total expenses component percentage
What is Total Expenses/Total Sales
400
The business's total expenses are greater than the total revenue, the difference is known as
What is Net Loss
400
The calculation for ending capital
What is Beginning Capital plus Net Income (or less Net Loss) Less Drawing
400
The information needed to prepare the assets section of the balance sheet is obtained from
What is worksheet's balance sheet debit column?
400
A Source Document is prepared for each transaction.
What is Objective Evidence?
500
Advertising Expense = 100 Accounts Payable = 2,000 Cash = 20,000 Sales = 10,000 Rent Expense = 2,500 Wage Expense = 3,000 Net Income/Net Loss and amount?
What is Net Income of $4,400?
500
For a compound percentage to be useful, a business must know...
What is acceptable percentages (industry standards)
500
Calculate ending capital given the following: Beg. Capital = 10,000 Sales = 2,000 Net Loss = 3,000 Drawing = 2,000 Cash = 11,000
What is 5,000?
500
The source for capital for the balance sheet
What is a Mathematical Equation?
500
Revenue is recorded at the time goods or services are sold.
What is Realization of Revenue?
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