GAAP
What does GAAP stand for?
Generally Accepted Accounting Principles
For a balance sheet to be "balanced", which totals must be the same?
1) Total assets 2) Total liabilities and equity
If a company has $5000 of prepaid supplies on January 1st, and count $3000 left on December 31st of that same year, how many did they use up during the year?
$2000
When an owner withdraws money from their business, which account is credited?
Bank/Cash
What is an individual box on a spreadsheet called?
Cell
The Principle of Conservation states that: "Accounting will be ____ and ____.
Fair, Reasonable
True or False: A Trial Balance and Balance Sheet are the same document with the same information.
False
Which part of the fical year are late arriving entries/adjustments completed
The end
When a business owner spends business money for their personal use, which account is always debited
Drawings
Which "shortcuts" do accountants input in spreadsheet cells to achieve efficient/accurate calculations?
Cell Formulas
True or False: The cost principle doesn't state that long term assets must be listed at their purchase price
False
If a balance sheet has the following totals, is it balanced? Total Assets: 150 000, Total Liabilities: 50 000, Equity Ending Balance: 100 000
Yes
To reduce the balance of prepaid Insurance, which account must be debited?
Insurance Expense
True or False: Capital is always a debit balance while Drawings is always credit.
False (Opposite)
Land, Equipment, and Automobiles are examples of ____ _____ assets.
Long Term
True or false: The Objectivity Principle states that there must always be proven evidence that a transaction has occurred.
True
When calculating the decrease in Capital under Owner's Equity, which account must be subtracted from the Net Income
Drawings
True or False: When using the straight line method, apart from the first year, all the following years will Depreciate the same amount.
True
When a business' money is spent for the business, which account is always debited?
Expense Account (Varies)
If a business sells a $200 asset with 13% HST, what amount will their HST Payable be
$26
If an accountant only records revenue once they actually receive the money (rather than when the sale is made), which principle are they going against?
Revenue Recognition Principle
Which section of the Balance Sheet is HST logged?(Hint: Assets, Liabilities, or Owner's Equity)
Liabilities
To calculate depreciation using the Declining Balance Method, which data is needed? A) Salvage Life B) CCA Rate
B
What types of accounts are prepaids? (ex: Prepaid Supplies, Prepaid Insurance, Prepaid Advertising)
Assets
Which column on the balance sheet do totals go under?
The Last/The 3rd