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Accounting 101
A, L & OE
Accounting Cycle
Vocabulary
Law
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

What is Asset, Liability, Owners Capital

What is 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
What is revenue, expenses, owner's withdrawals
What is temporary accounts?
200
In addition to an owner, these people also have claims against a company's assets.
Who are creditors?
300

These represent the 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
Identify the accounts affected Classify the account affected Determine the amount of increase or decrease for each account affected 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

These are 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 is assets?
400
This system is used to analyze and record a transaction
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?