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A list of all the accounts used by a business
What is a chart of accounts?
These accounts are being affected when service is performed on credit
What is?
Debit A/R
Credit Revenue/Fee Income
The first step in the accounting cycle
What is Analyze Transaction
An account only used during the closing process to summarize results of an operation
What is Income Summary?
This financial statement is always prepared first
Business transaction are recorded in a ____ and sometimes be called a diary of a business activities
What is a journal?
These accounts are being affected when equipment is purchased by issuing a check.
What is?
Debit Equipment
Credit Cash
What is Prepare Journal Entries
When the purchaser keeps the goods but receives a reduction in the price of the goods
When errors are made in the accounting records, they should be adjusted by making a
What is Correcting Entry
Two types of inventory system
Periodic Inventory System
Perpetual Inventory System
These accounts are being affected when the owner's withdrew funds from the business
What is?
Debit: Owner's drawing
Credit: Cash
This step involves journalizing the closing entries
Accountant use this account to analyze transactions
What is a T account
After revenue is subtracted from the expenses, this amount is then fed into the Owners Equity to determine whether the owners capital has increase or decrease
Three basic types of businesses
Service business
Merchandising business
Manufacturing business
These accounts are being affected when a firm closes its revenue for the period end
What is?
Debit: Revenue/Fee income
Credit: Income summary
This step is to be prepared after a Worksheet has been completed
What is a Financial Statements
A subsidiary ledger that contains credit customer accounts
What is an Account Receivable Ledger
What does 2/10, n/30 stands for
2% discount if paid in 10 days or paid the net in 30 days.
An account with a normal balance that is opposite that of a related account
What is a contra account
A firm paid their supplier within the discount period 2/10, n/30
What is?
Debit: A/P
Credit: Cash
Credit: Purchase discount
What does a sole proprietor do after a firm has been established?
What is Invest cash into the firm
When a firm needs to place an order for supplies or goods, it must prepare...
What is Purchase Requisition
This report is prepared to show the quantity and condition of the goods received
What is Receiving Report