Accounting Chapter 5

checking account – a bank account from which payments can be ordered by a depositor
annual depreciation expense – cost- salvage value/ estimated useful life
GST settlement – a payment made to the ATO by the small business to settle GST payable.
Accounting equation – economic occurrence that changes an enterprise's assets, liabilities, or stockholders' equity
Revenue recognition – accounting principle that states that revenue is recognized and recorded on the date it is earned even if cash has not been received.
What does it mean to incur an expense? – An expense is incurred by a company if the activity to the expense have been used or consumed
AIS – organized means by which financial info is identified, measured, recorded and retained for use in accounting statements and management reports
operating activities – once a business has the assets it needs, it can begin its operations
When Greece's economy could no longer function, everyone looked to ____________ for assistance.  
Owner withdrew cash for personal use – Owner, Drawing: Cash.
Owner's Equity and Assets.
OE: Increases.
Assets: Decrease.
Statement of Owner's Equity and Equity Balance Sheets.
Errors – Accieential errors in recording transactions or applying principles
In a homogeneous cost pool, all costs have a similar cause-and-effect relationship with the cost-allocation base. – True
Liabilities – Debts that are owed to creditors
When Greece's ecоnоmy cоuld no longer function, everyone looked to ____________ for аssistаnce.  
Productive Assets – long-term assets, usually used for more than one year
Examples of current assets – 1. cash
2. Accounts receivable
3. Supplies
4. Obligations due from customers
Comprehensive Income – Change in equity (net assets) of an entity during a period from transactions and other events and circumstances from nonowner sources. It includes all changes in equity during a period except those resulting from investments by owners and distributions to owners.
Asset measurement

No lo entiendo, revisar… – 1. Acquisition historical cost:
Its what was paid including all expenses.

2. Current replacement cost:
What a firm would have to pay to buy same future benefit

3. Net realizable value:
What the firm could sell asset for, in ordinary fashion
Including transaction costs

4. Fair value:
What the firm could set the asset for, in ord fashion
Not including transaction costs

This entry was posted in Uncategorized. Bookmark the permalink.

Leave a Reply