Principles Of Accounting Level 1 Chapter 1

Dividends – Profits that are distributed to owners
normal side balance Prepaid Rent – Dr
Balance Sheets – A financial statement that reports assets, liabilities, and owner's equity on a specific date.
Workers' Compensation Insurance – Insurance that protects employees against losses from job-related injuries or illnesses, or compensates their families if death occurs in the course of the employment.
State the accounting equation. – Assets = Liabilities + Owner's Equity
Net Income – net earnings, profit, selling more than the cost of producing (revenue – expenses, the bottom line), the excess of total revenues over total expenses
GAAP – Generally Accepted Accounting Principles.Revenues recognized when earned and expenses are recognized when incurred.
Translate the following argument into symbolic form and determine if the argument is valid or invalid along with the rule that was used. If our songs play on the radio then rock n' roll lives. Rock n' roll does not live. Therefore, our songs do not play on the radio.
purchase returns and allowances – a reduction in the cost of purchases associated with unsatisfactory goods
Taxable – Public medical plans
current liabilities – Obligations the company is to pay within the coming year.
Usually list notes payable first, followed by accounts payable.
Dividend Payout Ratio – The annual dividend amount divided by the annual net income.
Quick assets – Cash
Marketable securities
Account receivables
Change in an Accounting Estimate – An estimate that changes due to new information, subsequent developments, or improved judgments that impacts current and future periods.
Trаnslаte the fоllоwing аrgument intо symbolic form and determine if the argument is valid or invalid along with the rule that was used. If our songs play on the radio then rock n' roll lives. Rock n' roll does not live. Therefore, our songs do not play on the radio.
If the tax rate is t, it is possible to calculate planned operating income by:
a. dividing net operating income by t
b. dividing net operating income by 1- t
c. multiplying net operating income by t
d. multiplying net operating income by 1- t – b. dividing net operating income by 1- t
Period Cost (Non-Manufacturing) – all costs not included as product costs, expensed in the year incurred (operating expense)

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