ACC-Chapter 3 Word Scramble
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Question | Answer |
Accrual-Basis Accounting | Accounting basis in which companies record transactions that change a company’s financial statements in the period in which the events occur |
Accruals | Adjusting entries for either accrued revenues or accrued expenses |
Accrued Expenses | Expenses incurred but not yet paid in cash or recorded |
Accrued Revenues | Revenues earned but not yet received in cash or recorded |
Adjusted Trial Balance | A list of accounts and their balances after the company has made all adjustments |
Adjusting Entries | Entries made at the end of an accounting period to ensure that companies follow the revenue recognition and matching principles |
Book Value | The difference between the cost of a depreciable asset and its related accumulated depreciation |
Calendar Year | An accounting period that extends from January 1 to December 31 |
Cash-Basis Accounting | Accounting basis in which companies record revenue when they receive cash and an expense when they pay cash |
Contra Asset Account | An account offset against an asset account on the balance sheet |
Deferrals | Adjusting entries for either prepaid expenses or unearned revenues |
Depreciation | The allocation of the cost of an asset to expense over its useful life in a rational and systematic manner |
Fiscal Year | An accounting period that is one year in length |
Interim Periods | Monthly or quarterly accounting time periods |
Matching Principle | The principle that companies match efforts (expenses) with accomplishments (revenues) |
Prepaid Expenses | Expenses paid in cash that benefit more than one accounting period and that are recorded as assets |
Revenue Recognition Principle | The principle that companies recognize revenue in the accounting period in which it is earned |
Time Period Assumption | An assumption that accountants can divide the economic life a business into artificial time periods |
Unearned Revenues | Cash received and recorded as liabilities before revenue is earned |
Useful Life | The length of service of a productive facility |
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JJACCOUNTING
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