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Acct 115
Accounting
| Question | Answer |
|---|---|
| GAAP | Generally Accepted Accounting Principles |
| OCBOA | Other Comprehensive Basis of Accounting |
| Accounting | Information System that identifies, records, and communicates the economic events (transactions) of an organization to interested users. |
| Financial Accounting | Process that culminates in the preparation of financial reports on the enterprise as a whole for use by parties, internal and external, to the organization to interested users. |
| Interested users | Includes Internal and External users |
| Internal Users | Workers of a organization (CEO,CFO, VP, Managers (Business,Plant, & Store), Employees) |
| External Users | Investors(pay for ownership), creditors (must pay back), Consumers/Citizens, Government |
| Primary External User | Creditors because of debt due |
| Accounting Cycle (Chapter 1-3) | 1.Analyze Business 2.Record in Journal 3.Post to Central Ledger 4.Prepare an unadjusted Trial Balance |
| Accounting Cycle (Chapter 4-5) | 5. Record & Post adjusting journal entries 6.Prepare an adjusted Trial Balance 7. F/S 8. Close |
| Financial Statements | Principles means through which financial information is communicated to those outside an enterprise |
| Financial Statements examples | 1.The Income Statement 2.The Statement of Retained Earnings 3.The Balance Sheet 4.The Statement of Cash Flows |
| Income Statement Includes | Revenues - Expenses equals Net Income(or loss) |
| Heading of Income Sheet, Cash Flow & Retained Earnings | Company name, Statement name, Date,(FYE) |
| Heading of Balance Sheet | Company name, Statement name, Date |
| Revenues | Performance where money is earned. Not considered revenue if money is not given immediately |
| Expenses | Contributions to your Revenue |
| Statement of Retained Earnings | Beginning Balance of Retained Earnings + Net Income (or loss) – Dividends Declared equals Ending Balance of Retained Earnings |
| Beginning Balance of Retained Earnings | From the last Calendar Year |
| Dividend Declared | Company will announce or "declare" the payment of the dividend. This will include the dividend amount, the payout date , and who gets the dividend payment. The board of directors determines money. |
| The Balance Sheet | Assets equal Liabilities + Shareholders’ Equity |
| Assets | Cash, Accounts Receivable, Investment, Inventory, Plant & Equipment, supplies (resource owned and operated by company), anything pre-paid (Insurance, Rent, Intangibles) |
| Liabilities | Obligations, unearned revenue (cash received in advance of performance), Salaries, Dividends, interest, accounts, AND Notes payable, Taxes Paid |
| Shareholders’ Equity | (Ending Balance ONLY) Contributed Capital, Investment by owners, Capital Stock. |
| Earned Capital | Retained Earnings |
| Statement of Cash Flows | Sources and Uses of Cash from Operating, Investing, and Financing Activites |
| Operating Activties | Anything from Income Statement (you see most money here) |
| Investing Activities | Buying/Selling of plant/equipment, Investment. (You don’t usually don’t want to see any money here) |
| Financing Activities | Issuing and Buying back shares of stock. Debt and Equity would be seen here |
| Debit Examples | Cash, Accounts, Trade, Dividend Paid, Rents Expenses, Salary Expenses, Maintenance Expenses, Fuel Expenses |
| Credit Example | Notes Payable, Accounts Payable, Dividends Paid, Capital Stock, Dividend Declared |
Created by:
bja34
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