Accounting Exam Study Guide
Posted: Tue Aug 03, 2021 7:09 am
8-K: Report used by publicly traded companies to disclose material not related to investors
10-K: Annual report that publicly traded companies file with SEC
10-Q: Quarterly report that publicly traded companies file with SEC
Accounting: System that collets and processes financial information about an organization and reports = information to decision makers
Account: Standardize format that organization user to accumulate dollars amounts.
Accounting Cycle: Analyze record transactions, adjust records at end of statements, prepare records for next cycle.
Accounts Receivable: Open accounts owed to business by trade customers
Accrual Basis Accounting: Records revenues when earned an expenses incurred.
Accrued Expenses: Unrecorded expenses that need to be adjusted
Accrued Revenues: Unrecorded revenues that need to be adjusted
Additional Paid-in Capital: The amount of contributed capital less the par value of the stock.
Accounting Entity: Organization for which financial data are to be collected
Accounting Period: The time period covered by the financial statements.
Assets: Probably future economic benefits as a result of past transactions
Audit: Examination of financial reports.
Balance Sheet: Statement of financial position reports assets, liabilities, and stockholders accounting entity.
Basic Account Equation (Balance Sheet Equitation): Assets – Liabilities + Stockholders’ Equity
Cash Basis Accounting: Records revenues when cash is received and expenses when cash is paid.
Common Stock: Basic voting stock issued by a corp.
Current Assets: Assets used to be turned into cash within one year.
Current Liabilities: Short-term obligations that will be paid in cash within current year.
Debit: Left side of the account.
Expenses: Decrease in assets or increases in liabilities from ongoing operations.
Faithful Representation: Requires information be correct and complete.
GAAP: Measurement and disclosure rules users to develop the information in financial statements
Gains: Results primarily form disposing noncurrent assets and investments.
Gross profit percentage: Measures excess of sales process over costs to purchase goods as a percentage
Going Concern Assumption: Businesses are assumed to continue to operate in the foresable future
Income Statement: Reports the revenues less the expenses of accounting period.
Journal Entry: Accounting method expressing effects of a transaction on accounts in a debits-equals-credits format
Liabilities: Probable future sacrifices of economic benefits from a present obligation to transfer cash goods
Losses: Disposing of noncurrent assets and investments for less than the reported book value cost.
Mixed-Attribute Measurement Model: Measures different assets and liabilities of a balance sheet.
Monetary Unit Assumption: Accounting info should be measured and reported in national monetary unit.
Operating Income: Net sales less operating expenses
Par Value: Normal value per share of stock as specified by corp charter.
Post-Closing Trial Balance: Additional step in accounting cycle checks debits equal credits and temp accounts are closed.
Primary Objective of Financial Reporting to External Users: info useful to investors, lenders, creditors
Relevant Information: Information that can be used to influence a decision
Retained Earnings: Cumulative earnings of a company that are not distributed to owners and reinvested in biz
Revenue Recognition Principle: Company transfers promised goods or services to customers. (Recognized)
ROA: Measures how much the firm earned for each dollar of investment.
Separate Entity Assumption: Biz transactions are separated from those of owners
Statement of Cash Flows: Reports inflows and outflows of accounting period in operating, investing and financing.
Stockholders Equity: Financing provided by the owners and ops of the business.
Statement of Stockholders Equity: reports the changes in company’s stockholders equity accounts in period
T-Account: Tool that summarizes transaction effects for each account, determines balances, and differences in act.
Trial Balance: A list of all accounts with their balances to provide a check in the equality of debits and credits
Time Period Assumption: The long life of a company can be reported in shorter time periods: months, quarters, yr
10-K: Annual report that publicly traded companies file with SEC
10-Q: Quarterly report that publicly traded companies file with SEC
Accounting: System that collets and processes financial information about an organization and reports = information to decision makers
Account: Standardize format that organization user to accumulate dollars amounts.
Accounting Cycle: Analyze record transactions, adjust records at end of statements, prepare records for next cycle.
Accounts Receivable: Open accounts owed to business by trade customers
Accrual Basis Accounting: Records revenues when earned an expenses incurred.
Accrued Expenses: Unrecorded expenses that need to be adjusted
Accrued Revenues: Unrecorded revenues that need to be adjusted
Additional Paid-in Capital: The amount of contributed capital less the par value of the stock.
Accounting Entity: Organization for which financial data are to be collected
Accounting Period: The time period covered by the financial statements.
Assets: Probably future economic benefits as a result of past transactions
Audit: Examination of financial reports.
Balance Sheet: Statement of financial position reports assets, liabilities, and stockholders accounting entity.
Basic Account Equation (Balance Sheet Equitation): Assets – Liabilities + Stockholders’ Equity
Cash Basis Accounting: Records revenues when cash is received and expenses when cash is paid.
Common Stock: Basic voting stock issued by a corp.
Current Assets: Assets used to be turned into cash within one year.
Current Liabilities: Short-term obligations that will be paid in cash within current year.
Debit: Left side of the account.
Expenses: Decrease in assets or increases in liabilities from ongoing operations.
Faithful Representation: Requires information be correct and complete.
GAAP: Measurement and disclosure rules users to develop the information in financial statements
Gains: Results primarily form disposing noncurrent assets and investments.
Gross profit percentage: Measures excess of sales process over costs to purchase goods as a percentage
Going Concern Assumption: Businesses are assumed to continue to operate in the foresable future
Income Statement: Reports the revenues less the expenses of accounting period.
Journal Entry: Accounting method expressing effects of a transaction on accounts in a debits-equals-credits format
Liabilities: Probable future sacrifices of economic benefits from a present obligation to transfer cash goods
Losses: Disposing of noncurrent assets and investments for less than the reported book value cost.
Mixed-Attribute Measurement Model: Measures different assets and liabilities of a balance sheet.
Monetary Unit Assumption: Accounting info should be measured and reported in national monetary unit.
Operating Income: Net sales less operating expenses
Par Value: Normal value per share of stock as specified by corp charter.
Post-Closing Trial Balance: Additional step in accounting cycle checks debits equal credits and temp accounts are closed.
Primary Objective of Financial Reporting to External Users: info useful to investors, lenders, creditors
Relevant Information: Information that can be used to influence a decision
Retained Earnings: Cumulative earnings of a company that are not distributed to owners and reinvested in biz
Revenue Recognition Principle: Company transfers promised goods or services to customers. (Recognized)
ROA: Measures how much the firm earned for each dollar of investment.
Separate Entity Assumption: Biz transactions are separated from those of owners
Statement of Cash Flows: Reports inflows and outflows of accounting period in operating, investing and financing.
Stockholders Equity: Financing provided by the owners and ops of the business.
Statement of Stockholders Equity: reports the changes in company’s stockholders equity accounts in period
T-Account: Tool that summarizes transaction effects for each account, determines balances, and differences in act.
Trial Balance: A list of all accounts with their balances to provide a check in the equality of debits and credits
Time Period Assumption: The long life of a company can be reported in shorter time periods: months, quarters, yr