Financial Position
Understanding of Accounting
Business Transactions
Terms to Know
100
A creditor
Person or business that has extended credit or loaned money to another individual or business
100
The financial status of a person or company represented by the assets, liabilities, and net worth or personal equity.
What is meant by financial position?
100
An exchange of things of value
What is a business transaction?
100

What is GAAP

Generally Accepted Accounting Principles

200
A= L+OE Assets=Liabilities+Owner's Equity
What is the balance sheet equation?
200
Controlling, analyzing, and interpreting the financial information in the accounting system.
What is accounting?
200
Used to assist in the examination of transactions and their effects on the balance sheet.
What is a transaction analysis sheet?
200

What is FASB

Financial Accounting Standard Board

300
Business entity principle
Requires each business be considered as separate entity,and that the financial data for each business be kept separate from the owner's personal financial data.
300
Indicate final total
What does a double underline on a financial report mean?
300
Does not have shared traded on the stock market and not accountable to the public.
What is a private business?
300

Financial Statements

These are a collection of summary-level reports that reflect the organization’s financial results, position, and cash flow.

400
Maturity date
What is the term of payment due date to any liability?
400
Addition or subtraction of column
What does a single ruled line of financial report indicate?
400
Listed on stock exchange and is accountable to the public.
What is a public business?
400

General Journal

This is an accounting book where the transactions are recorded sequentially, in chronological order. It need not be balanced.

500
Liquidity order
The order in which current assets would likely be converted into cash.
500
Owner, Management,Bankers and Creditors,Investors and Government
Five users of financial information
500
They contain principles,rules,and examples to guide accountants, and a complete set comprises over 2200 printed pages.
What is the main role of the International Accounting Standards Board?
500

Assets

The money and/or propriety that the company owns

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