Term
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Definition
| Identifies, Records, and communicates |
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Term
| Users and Uses of Accounting |
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Definition
Internal & External Users
a) Management
b) Investors (owners)
c) Creditors (suppliers and bankers) |
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Term
| Why is ethics a fundamental business concept? |
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Definition
Ethics - Right/Wrong
If you cannot depend of the honesty of a person, communication and economic activity would be impossible. |
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Term
| Generally accepted accounting principle (GAAP) |
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Definition
| Set of standards used by accountants to indicate how to report economic events |
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Term
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Definition
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Term
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Definition
| Requires that companies include in the acct records only transaction data than can be expressed in terms of money |
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Term
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Definition
| Requires that companies include in the acct records only transaction data than can be expressed in terms of money |
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Term
| Economic entity assumption |
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Definition
| requires that the activities of each economic entity be kept separate from the activities of its owner and other economic activities. |
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Term
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Definition
| Resources owned by a business |
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Term
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Definition
| creditorship claims on total assets |
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Term
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Definition
| ownership claim on total assets |
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Term
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Definition
| presents the revenues and expenses of a company for a specific period of time |
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Term
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Definition
| a record of increases and decreases in a specific asset, liability, or equity item |
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Term
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Definition
| assumes that the economic life of a business is divided into artificial time periods |
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Term
| accrual basis of accounting |
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Definition
| companies record events that change a company's financial statements in the periods in which those events occur, rather than in the periods in which the company receives or pays cash |
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Term
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Definition
| adjusting entries for either prepaid expenses or unearned revenue |
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Term
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Definition
| cash received and recorded as liabilities before revenue is earned |
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Term
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Definition
| adjusting entries for either accrued revenues or accrued expenses |
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