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Formulas
Balance Sheets/Income Statements
Paralegal Rules of Conduct
Journals and Ledgers
Favourite Words and Phrases
100
Assets = Liabilities + Net Worth
What is The Accounting Equation?
100
To record what we own and what we one.
What is the main purpose of a Balance Sheet?
100
$7500.00 Canadian Dollars.
What is the maximum amount of cash a paralegal can receive for any one client file? (By-Law 9, Part III, s. 4(1))
100
In a manual accounting system using special journals, it is used to record transactions that do not occur on a regular basis or with sufficient volume to justify maintaining a separate book.
What is a General Ledger?
100
The owner of a business is personally responsible for the debts of the business.
What is Unlimited Liability?
200
Opening Net Worth + Capital +Surplus (Deficit) = Closing Net Worth
What is Net Worth Calculation?
200
An entry that decreases assets, expenses, and the owner's drawings account or increases liabilities, revenue and the owner's capital account; recorded on the right side of the T-account.
What is a Credit?
200
Six years.
What is the minimum amount of time a paralegal must retain certain financial records? (By-Law 9, Part V, s. 23(1))
200
The process of recording the initial entries used to record every transaction and the purpose of the transactions.
What is Journalizing?
200
The rules that indicate acceptable accounting practice
What is The Generally Accepted Accounting Principles (GAAP)?
300
Original purchase price - accumulated depreciation.
What is The Book Value?
300
The principle which requires expenses to be reported in the same period as the revenues to which they are related.
What is The Matching Principle?
300
An account a paralegal must use to hold funds received by clients prior to completing work.
What is a Trust Account? (By-Law 9, Part IV, s. 7(1))
300
Ensures the balance sheet is in balance after closing the previous period.
What is Post Closing Trial Balance?
300
The uniform international accounting standard that Canada and many other countries have adopted.
What is The International Financial Reporting Standards (IFRS)?
400
Is it the truth? Is it fair to all concerned? Will it build goodwill and better friendships? Will it be beneficial to all concerned?
What is The 4-Way Test?
400
The approach to preparing financial statements that uses the adjusting process to recognize revenues when earned and expenses when incurred.
What is The Accrual Accounting?
400
1. The period of time for which the money has been held in trust. 2. The reasons why the licensee is unable to determine who is entitled to the money. 3. Any other information that the Society may require.
What is required on an application to the Law Society when submitting excess trust funds? (By-Law 10, s. 3)
400
This is what occurs when two adjacent numbers are switched.
What is Transposition Errors?
400
The accounting requirement that a company use the same accounting methods period after period so that the financial statements of succeeding periods will be comparable.
What is The Consistency Principle?
500
Ending Owner's Equity Balance = Beginning Owner's Equity Balance + Owner's Contributions + Net Income (Loss) - Owner's Withdrawals
What is the Ending Owner's Equity Balance Formula?
500
This is documented on the income statement but the balance sheet.
What is Depreciation?
500
This By-Lay also applies, with necessary modifications, in respect of former licensees.
What is By-Law 10, s. 9?
500
1. Error of Principle 2. Error of Total Omission 3. Repeated Entry Error 4. Original Entry Error 5. Reversal Error
What are the five errors which can occur that will leave the trial balance in balance?
500
This ratio indicates how much has been borrowed versus how much has been invested by the shareholders.
What is The Debt-to-Equity Ratio?