Accounting I Midterm 2015

Withdrawals – Asked if taken out of the business for the owners personal use
balance sheet – list of assets, liabilities and owner´s equity, specific date usually end of year
Cash in Exchange for Stocks – Assets and Equity rise
owners equities – the amount remaining after the value of all liabilities is subtracted for the value of all assets.
Endorsement – A signature or stamp on the back of a check, transferring ownership
Units produced – units in month+(units in next month x %) -units in month x %
profit and loss statements – Another term for the income statement, An itemized financial statement of the income and expenses of a company's operations.
statement of cash flow – cash flow in and cash flow out
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FOB destination – situation in which the buyer takes ownership (title) at the delivery destination point and the seller pays the freight
Determining profit through the capital account – if the capital account has increased, then there was a net income recorded last fiscal period, if the account has decreased, then there was a net loss last fiscal period.
Statement of Retained Earnings – Reports the way that net income and the distribution of dividends affected the financial position of the company during the accounting period.
Expenses – A decrease in owner's equity resulting from the operation of a business.
Accrual Basis Concept – The effects of transactions and other events are recognised when they occur and reported in the financial reports of the period to which they relate.
statement of operation – income statement
invoice – a form describing the goods or services solld, the quanitity, and the price
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Cost principle (historical cost principle) – States that assets should be recorded at their "original cost "
shareholders – owners of a corporation. not personally liable for corporate acts or debts also know as stockholders
journal – a form for recordeing transaction in chronological order
Similarities between GAAP & IFRS – IFRS is based on the same four characteristics of information as stated in GAAP (relevance, reliability, understanding, and comparability) Also, the basic principles and assumptions of GAAP are aligned with those of IFRS.
posting – The process of transferring data from the journal into the general ledger.

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