Accounting 1
Assets taken out of a business for the owner's personal use.
What are "withdrawals?"
People involved within the business, making decisions to benefit the running of the business.
What is an internal user?
Financial information should be backed by documentary evidence.
What is Verifiability?
Actions that affect individuals, the community and the environment.
What are social influences?
Accounting information is meaningful, significant and timely to be included in the financial reports.
What is Relevance?
Assets which are expected to be turned into cash in the next 12 months.
What are current assets?
Morally doing what is right.
What are ethical issues?
Assets are valued at the price paid to acquire them.
What is the Historic Cost Assumption?
A business owned by two or more people.
What is a partnership?
A sale for which cash will be received at a later date.
What is a Debtor?
Using care and caution in the valuation of Assets and the measurement of profit.
What is the Prudence Assumption?
A business owned by one person.
What is a Sole Trader?
Financial reports should be complete, error free and unbiased.
What is Faithful Representation?
The steps involved in collecting data and converting it to information for decision-making.
What is the Accounting Process?
The business is considered a separate reporting entity from its owners.
What is the Accounting Entity assumption?
An amount owed by a business to external parties.
What is a "Liability?"
Financial reports that summarize the financial position of a business.
What is the Balance Sheet?
The rules of Accounting.
What are Accounting Conventions and Standards?
The dollar is the basic unit of Accounting.
What is the Monetary Assumption?
The life of the business is divided up into equal reporting periods.
What is the Accounting Period Assumption?