Term
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Definition
| Planning, recording,analyzing, and interperting finanial information. |
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Term
| What is accounting system? |
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Definition
| A planned process for providing financial information that will be useful to management. |
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Term
| What are accoutning records? |
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Definition
| Organized summaries of a business's financial activities. |
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Term
| What often contributes to business failures or bankruptcy? |
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Definition
| Inaccurate accounting records. |
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Term
| What is service business? |
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Definition
| The business that performs for a fee. |
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Term
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Definition
| A busniess owned by one person. |
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Term
| What does encore music do? |
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Definition
| They rent office spaceand their instruments used to teach music lessons. |
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Term
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Definition
| Anything of value that is owned. |
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Term
| What are some examples of assets? |
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Definition
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Term
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Definition
| Financial rights to the assets of a business. |
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Term
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Definition
| An amount owned by a business. |
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Term
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Definition
| The amount left over after subtracting liabilities from assets. |
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Term
What is important to remember
About the accounting Equation? |
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Definition
| It Must be in balance in order to be correct.this means that the total of the accounts on the left sideof the equation must always equal the total of the amount the right side. |
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Term
| Whats the liabilitie equation? |
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Definition
| Assets = Liabilities + Owner's Equity |
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Term
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Definition
A financial statement that
reports assets, liabilities, and owner's equity on a specific date. |
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Term
| What are the major sections of a balance sheet? |
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Definition
1 Assets are on the left side of the accounting. Equation, which means assets are also on this left side of the balance sheet.
2 Liabilities are on the right side of the accounting equation , which means that liabilities are listed on the right side of the balance sheet.
3 Owner's equity - located on the right side of theaccounting equation, which means that Owner's equity is also listed on the right side of the balance sheet. |
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Term
| What are with steps to preparing a balance sheet? |
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Definition
write the heading centered on the top three lines of the balance sheet; the name of the business, the name of the report, ( Balance sheet), and the date of the report.1. Prepare the assets section. Center the word "assets" on the first line of the wide column on the right. Under this heading write each assets account and amount.
2. Prepare the Liabilities section. Center the word "Liabilities" on the first line of the wide column on the right. Under this heading, write Liability account and amount.
3. Prepare the Owner's equity section. Center the words "Owner's Equity" on the next blank line under the liabilities section. Under this heading write Owner's Equity account title and amount.
4. Add all the assets accounts. Add the liabilities and owner's equity amounts. If the totals equal, the balance sheet is in balance (correct).
5. rule a single line across each amount column. A single line means that the amounts are to be added or subtracted.
6. On the next line of the left side, write total assets amount under the single rule. On the right side, write total liabilities and owner's equity amount under the single rule.
7. Rule double lines below the amount column totals. Double rules means that the totals have been verified as correct. |
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