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Accounting 101
A, L & OE
Accounting Cycle
Vocabulary
Miscellaneous
100
These are the 5 main activities involved in accounting
What are 1) Gathering financial information, 2) Preparing and collecting records, 3) Summarizing and classifying financial information, 4) Preparing formation reports and summaries and 5) Establishing controls to promote accuracy and honesty among employees?
100
These are items owned that have monetary value
What are assets?
100
It is anything of value that a person or business owns and therefore controls
What is property?
100

The kind of account that includes: Asset, Liability, Owners Capital

What are permanent accounts?

100
When a business buys a computer with cash, its cash ______, but its computer equipment ________
What decreases and increases?
200
This is the purpose of accounting
What is to 1)identify, 2)record and 3)communicate financial information?
200
These are the 2 ways the fundamental accounting equation is stated.
What are 1) Assets-Liabilities=Owner's Equity and 2) Assets=Owner's Equity+Liabilities?
200
The business or person selling the item on credit, can be any person/business you owe money to
Who is a creditor?
200

The kind of accounts that include: revenue, expenses, owner's withdrawals

What are temporary accounts?

200
In addition to an owner, these people also have claims against a company's assets.
Who are creditors?
300

What is one (of a possible 3) types of business organizations that use accounting.

What are 1)sole proprietorships, 2)partnerships and 3)corporations?

300
This line on the balance sheet refers to money owed by a company
What is Accounts Payable?
300

What are you doing when you:
1) Identify the accounts affected, 2) Classify the account affected, 3) Determine the amount of increase or decrease for each account affected, 4) Make sure the accounting equation remains in balance

What is analyze a business transaction?

300
When you buy something and agree to pay for it later
What is Credit?
300
If a business closes, the claims of these individuals are settled first.
Who are creditors?
400

Name one of 3 professional accounting organizations.

What are Chartered Accountants (CAs), Chartered General Accountants (CGAs) and Certified Management Accountants (CMAs)?

400
This is the difference between total assets and total liabilities.
What is Owner's Equity?
400
Decreases both assets and owner’s equity
What is a withdrawal?
400

Property or items of value owned by a business

What are assets?

400

This system is used to analyze and record a transaction and requires two entries.

What is a double-entry accounting?

500
This involves testing business records and procedures for accuracy.
What is auditing?
500
The term used to explain how quickly a company can convert assets into cash.
What is liquidity?
500
It is a legal right to property
What is a financial claim?
500
Is a list of all accounts used by a business.
What is chart of accounts?
500
Income earned from the sale of goods or services is called?
What is revenue?