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Financial Statements
Adjusting/Closing Entries
Accounting Vocabulary
100
The revenue and expenses for a fisical period.
What does the Income Statement show?
100
The financial condition of a business.
A balance shet reports finacial information ona specific date, indicating...
100
Anthing of value that is owned.
What is an asset?
200
Assets, liabilities, and owner's equity on a specific date, usualy the end of the fisical period.
The balance sheet reports what?
200
(1) heading, (2) Assets, (3) Liabilities, (4) Owner's Equity
A balance sheet has four sections... What are they?
200
An amount owed by a business.
What is a liability?
300
(1) Liabilities, and (2) Owner's Equity.
Two kinds of equities are reported on a balance sheet... What are they?
300
The amount remaining after the value of all liabilities is subtracted from the value of all assets.
What is owner's equity?
400
Assets=Liabilities+Owner's Equity
What is the accounting equation?
500
1. Write the balance sheet heading on three lines. 2. Prepare the asets section of the balance sheet. 3. Prepare the liabilities section of the balance sheet. 4. Prepare the owners' equity section of the balance sheet. 5. Total the liabilities and owners' equity sections of the balance sheet. 6. Verify accuracy by comparing the total amount of assets and the total amount of liabilities and owners' equity. 7. Rule double lines across both amount columns below Total Assets and below Total Liabilities and Owners' Equity.
How do you prepare a balance sheet?
500
A business activity that changes assets, liabilities, or owner's equity.
What is a transaction?