Accounting 101
These are the 3 banches of accounting
financial accounting
management accounting
cost accounting
A resource with economic value that an individual ,corporation or country owns or controls with the expectation that it will provide it future bènefis
assets
It is anything of value that a person or business owns and therefore controls
property
What is the classifcation of land,building,equipment, in the balance sheet
fixed assets
When a business buys a computer with cash, its cash ______, but its computer equipment ________
decreases and increases
This is the purpose of accounting
1)identify, 2)record and 3)communicate financial information
These are the 2 ways the fundamental accounting equation is stated.
1) Assets-Liabilities=Owner's Equity and 2) Assets=Owner's Equity+Liabilities
The business or person selling the item on credit, can be any person/business you owe money to
creditor
What is the calssification of cash, prepaid expense, accounts receivable in the Balance Sheet
Curent Assets
In addition to an owner, these people also have claims against a company's assets.
creditors
These represent the types of business organizations that use accounting.
1)sole proprietorships, 2)partnerships and 3)corporations
Something a person or comapny owes, usually sum of money
Liability
The branch of accounting concerned with the summary, analysis, and reporting of financial transactions related to a business. This involves the preparation of finacial statements available for public use
financial accounting
What is goodwill, patents,trademarks and copyrights
intangible assets
debit prepaid ễxpense
credit cash
This is the difference between total assets and total liabilities.
Owner's Equity
The amount the owner of a business has invested in
owner's capital
A loaned money that a creditor writes off á uncollectible
bad debts
debit depreciation expense
credit accumulated depreciation
This involves testing business records and procedures for accuracy. It see to it that establised accounting procedures are being followed
auditing
The total amount of money being transferred into and out òf a business espspecially affecting liquidity
cash flow
A short term debt and a liability on a balance sheet where a business owes money to its vendors/suppliers that have provided the business with goods and services on credit
accounts payable
Is a list of all accounts used by a business.
chart of accounts
Income earned from the sale of goods or services is called?
revenue