Accounting I: Financial Accounting Ch 2

Owner's Equity – Owner's Equity is the residual interest in the assets of the entity after deducting all its liabilities.
A=L+OE or OE=A-L
Accrual-Basis Accounting – Accounting basis in which companies record transactions that change a company's financial statements in the periods in which the events occur.
Revenue – The money coming into the business from the sale of goods and services.
Sales invoices – Sales on account, prepare duplicate, original ➡customer, copy ➡ owner (S)
revenue – An increase in owners equity resulting from the operation of a business
statement of account – Kontoauszug /Kontoabrechnung
A credit balance in Cash Over and Short is reported as a (n)
A. asset.
B. liability.
C. miscellaneous expense.
D. miscellaneous revenue. – D
Owner's Equity – The financial interest of the owner of a business; also called proprietorship or net worth.
The world's volume of trade has been decreasing over time. 
Owners Equity – Amounts by which the business assets exceed the business liabilities. Also known as net worth or capital.
Dividend – Income distributed to shareholders
Inventory turnover ratio – a ratio that measures the liquidity of inventory by measuring the number of times average inventory sold during the period; computed by dividing cost of goods sold by the average inventory during the period
The wоrld's vоlume оf trаde hаs been decreаsing over time. 
Adjusted Trial Balance – Section of the worksheet used to verify the equality of debits and credits after the adjustments. The amounts from this section are extended to the Income Statement and Balance Sheet sections.
florist – one who sells flowers
ledger – record that contains all account
Certified Public Accountant/C.P.A – an individual possessing a college education,having practical experience in accounting and who has passed a comprehensive state examination in order to be certified to practive public accounting in that state
Faithful representation – Numbers ad descriptions match what really existed or happened – they are factual

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