Unit 1 Accounting (basic Accounting Principles)

sales return – credit allowed a customer for the sales price of returned merchandise
inadequacy – insufficient capacity of a companys plant assets to meet its growing productive demands
The major types of transactions that affect retained earnings are:
A) assets and liabilities
B) revenues and liabilities
C) revenues, expenses, and dividends
D) paid – in capital and common stock – C) revenues, expenses, and dividends
direct method – a method that allocates service costs directly to
producing departments. This method ignores any interactions that
may exist among support departments.
The measurement principle, also called the cost principle – i.
Customer deposits – similar to unearned revenue- liabilities
Depreciation expense – the amount of depreciation taken during the current fiscal year is properly termed
Which of the following items is NOT an assumption of CVP analysis?
a. Total costs can be divided into a fixed component and a component that is variable with respect to the level of output.
b. When graphed, total costs curve upward.
c. The unit-selling price is known and constant.
d. All revenues and costs can be added and compared without taking into account the time value of money. – b. When graphed, total costs curve upward.
How many exams are at the end of each chapter?
What are intangibles? – Assets without physical form e.g. research and development expenditure, patents, licences and trademarks, publishing rights and titles, goodwill, brands
separate entity assumption – a firms financial records are kept separate from its owners
21.An enterprise – is a project or undertaking, typically one that is difficult or requires effort.
copyright – intangible asset, BS, debit
Expenses – These items are decreases in assets or increases in liabilities that result from operating activities undertaken to generate revenue.
Ledger – The entire group of accounts maintained by a company
Non-Profit Organization – -designed to meet societal needs which provide social benefit
-often receive tax-exempt status
Hоw mаny exаms аre at the end оf each chapter?
In Balance. – A condition in which the total of the debits and the total of the credits are equal in an account.
petty cash slip – A form showing proff of a petty cash payment
decision making – Inherent in each of the preceding management process.
file maintenance – procedure for arranging accounts in a general ledger, assigning account numbers and keeping records

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