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FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING 2803
| Term | Definition |
|---|---|
| Accelerated depreciation method | Method that produces larger depreciation charges in the early years of an asset's life and smaller charges in its later years. |
| Account | Record within an accounting system in which increases and decreases are entered and stored in a specific asset, liability, equity, revenue, or expense. |
| Account balance | Difference between total debits and total credits (including the beginning balance) for an account. |
| Account form balance sheet | Balance sheet that lists assets on the left side and liabilities and equity on the right. |
| Account payable | Liability created by buying goods or services on credit; backed by the buyer's general credit standing. |
| Accounting | Information and measurement system that identifies, records, and communicates relevant information about a company's business activities. |
| Accounting cycle | Recurring steps performed each accounting period, starting with analyzing transactions and continuing through the post-closing trial balance (or reversing entries). |
| Accounting equation | Equality involving a company's assets, liabilities, and equity; Assets = Liabilities + Equity; also called balance sheet equation. |
| Accounting information system | People, records, and methods that collect and process data from transactions and events, organize them in useful forms, and communicate results to decision makers. |
| Accounting period | Length of time covered by financial statements; also called reporting period. |
| Accounts payable ledger | Subsidiary ledger listing individual creditor (supplier) accounts. |
| Accounts receivable | Amounts due from customers for credit sales; backed by the customer's general credit standing. |
| Accounts receivable ledger | Subsidiary ledger listing individual customer accounts. |
| Accounts receivable turnover | Measure of both the quality and liquidity of accounts receivable; indicates how often receivables are received and collected during the period; computed by dividing net sales by average accounts receivable. |
| Accrual basis accounting | Accounting system that recognizes revenues when earned and expenses when incurred; the basis for GAAP. |
| Accrued expenses | Costs incurred in a period that are both unpaid and unrecorded; adjusting entries for recording accrued expenses involve increasing expenses and increasing liabilities. |
| Accrued revenues | Revenues earned in a period that are both unrecorded and not yet received in cash (or other assets); adjusting entries for recording accrued revenues involve increasing assets and increasing revenues. |
| Accumulated depreciation | Cumulative sum of all depreciation expense recorded for an asset. |
Created by:
Cabanillas
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