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Accounting ch 6
College Accounting Ch 6
| Question | Answer |
|---|---|
| Accounting form of Balance Sheet | A balance sheet in which the assests are on the left and the liabilities and the owner's equity sections are on the right. |
| Accounting Cycle | The steps involved in accointing for all of the business activities during an accounting period. |
| Classified Balance Sheet | A balance sheet with separate categories for current asssests; property, plant, and equipment; current liabilities; and long term liabilities. |
| Closing Process | The process of giving zero balances to the temporary accounts so that they can accumulate information for the next accounting period. |
| Current Assets | Cash and assets that will be converted into cash or consumed within either one year or the normal operating cycle of the business, whichever is longer. |
| Current Liabilities | Liabilities that are due within either one year or the normsl opersting cycle of the business, whichever is longer, and that are to be paid out of current assets. |
| Income Summary | A temporary account used in the closing process to sumarize the effect of all revenue and expense accounts. |
| Long-Term Assets | Assets that expected to serve the business for many years. (Also called property, plant, and equipment or plant assets.) |
| Long-Term Debt | Obligations that are not expected to be paid within a year and do not require the use of current assets. (Also known as long-term liabilities.) |
| Long-Term Liabilities | Obligations that are not expected to be paid within a year and do not require the use of current assets. (Also known as long-term debt.) |
| Operating Cycle | The period of time required to purchase supplies and services and convert them back into cash. |
| Permanent Accounts | Accounts that accumulate information across accounting periods; all accounts reported on the balance sheet. |
| Plant Assets | Assets that expected to serve the business for many years. (Also called property, plant, and equipment or long-term assets.) |
| Post-Closing Trial Balance | Prepared after posting the closing entries to prove the equality of the debit and credit balances in the general ledger accounts. |
| Property, Plant, and Equipment | Assets that expected to serve the business for many years. (Also known as plant assets or long-term assets.) |
| Report Form of Balance Sheet | A balance sheet in which the liabilities and the owner's equity sections are shown below the assets. |
| Temporary Accounts | Accounts that do not accumulate information across accounting periods but are closed, such as the drawing account and all income statement accounts. |
Created by:
dengler
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