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Acctg II - Ch 1
Maplewood Rice Ch 1 Vocab
| Question | Answer |
|---|---|
| asset | anything of value that is owned |
| equities | financial rights to the assets of a business |
| liability | an amount owned by a business |
| Owner's equity | the amount remaining after the value of all liabilities is subtracted from the value of all assets |
| Accounting Equation | an equation showing the relationship among assets, liabilities, and owner's equity |
| Source Document | Information about business transaction is obtained from original business papers |
| Journal | a form for recording transactions in chronological order |
| Special Journal entry | a journal used to record only one kind of transaction |
| Double-entry accounting | the recording of debit and credit parts of a transaction |
| Account | a record summarizing all the information pertaining to a single item in the accounting equation |
| Ledger | a group of accounts |
| General Ledger | a ledger that contains all accounts needed to prepare financial statements |
| Subsidiary Ledger | a ledger that is summarized in a single general ledger account |
| Controlling account | an account in a general ledger that summarizes all accounts in a subsidiary ledger |
| File maintenance | the procedure for arranging accounts in a general ledger assigning account numbers and keeping records |
| Departmental accounting system | an accounting system showing accounting information for two or more departments |
| Merchandising business | a business that purchased and sells good |
| Posting | Transferring information from a journal entry to a ledger account |
| Debit memorandum | a form prepared by the customer showing the price deduction taken by the customer for returns and allowances |
| Contra account | an account that reduces a related account on a financial statement |
| Contra balance | an account balance that is opposite the normal balance |
| Cash discount | a deduction that a vendor allows on the invoice amount to encourage age prompt payment |
| Purchases discount | a cash discount taken by a customer |
| Petty cash | an amount of cash kept on hand and used for making small payments |
| Bank statement | a report of deposits, withdrawals, and bank balances sent to a depositor by a bank |
Created by:
lrice@penncrest.org
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