Financial Accouting Module 1

Front 1

Accounting

Back 1

A system that collects and processes financial information about an organization and reports that information to decision makers

Front 2

Unit of measure

Back 2

Measurement of information about a business in the monetary unit (dollars or other national currency)

Front 3

Partnership

Back 3

A unincorporated business owned by two or more people

Front 4

Private company

Back 4

A company that sells shares or its stock privately and is not required to release its financial statements to the public

Hint 4

Publix Company

Front 5

Corporation

Back 5

A incorporated business that’s issues shared of stock as evidence of owner ship

Front 6

Investing Activities

Back 6

Buying and selling productive resources with long lives

Front 7

Financing Activities

Back 7

Transactions with lenders and stock holders

Front 8

Operating activities

Back 8

Activities directly related to running the business to earn profit

Front 9

SEC

Back 9

Securities and exchange commission

Front 10

FASB

Back 10

Financial Accounting Standards Board

Front 11

Public Company

Back 11

A company that has its stock bought and sold on stock exchanges and it is required to publicly release its financial statements

Front 12

GAAP

Back 12

Generally accepted accounting principles

Front 13

Separate enitiy

Back 13

The financial reports of a business are assumed to include the results of only that businesss activities

Front 14

Assets

Back 14

The recourses owned by a company

Front 15

Faithful Representation

Back 15

Financial information that depicts the economic substance of business activities

Front 16

Stockholders Equity

Back 16

The total amount invested and reinvested in the business by the owners

Front 17

Expenses

Back 17

The cost of business necessary to earn revenues

Front 18

Relevance

Back 18

A feature of financial information that allows it to influence a decision

Front 19

Revenues

Back 19

Earned by selling gold or services to customers

Front 20

Liabilities

Back 20

The amounts owed by the business

Front 21

HAM

Back 21

Human recourse

Assets

Money

Front 22

Cost

Back 22

Cash going out

Front 23

Loss

Back 23

Cost and you get no benifit

Front 24

Financial statements

Back 24

Reports that summarize the financial results of business activities

Front 25

Creditors

Back 25

Suppliers, banks, and anyone to whom money is owed

Front 26

Directors

Back 26

Short term for a company’s board of directors

Front 27

Basic Accounting Equation

Back 27

Assets= liabilities + stockholders equity

Front 28

Separate entity assumption

Back 28

States that businesses transactions are separate from and should exclude the personal transactions. If the owner

Front 29

Statement of Retained Earnings

Back 29

Reports the way that net income and the distribution of dividends affect the financial position of the company during the accounting period

Front 30

Balance Sheet

Back 30

Reports the amount of assets, liabilities and stockholders equity of an accounting entity at a point in time

Front 31

Statement of cash flow

Back 31

Reports inflows and outflows of cash during the accounting period in the categories of operating, investing, and financing

Front 32

International Financial Reporting Standards (IFRS)

Back 32

The rules used internationally to calculate and report financial information in the financial statements

Front 33

Sarbanes- Oxley Act (SOX)

Back 33

A set of laws established to strengthen corporate reporting in the US

Front 34

Ethics

Back 34

The standards of conduct for judging right from wrong

Front 35

Cost Principle

Back 35

When you acquire an assets you write in the book your amount

Front 36

Financing

Back 36

Getting money to buy something

Front 37

Equity financing

Back 37

From sale of stock

Hint 37

Only corporations can do this

Front 38

Debt

Back 38

Loans

Front 39

Sale debt

Back 39

Bonds

Front 40

Self financing

Back 40

Paying from cash the business has

Front 41

Investing

Back 41

Buying long term assets

Front 42

Transaction

Back 42

Exchange for value to value

Front 43

External Transactions

Back 43

Between company and customers, suppliers, and employers

Front 44

Internal

Back 44

Value or worth has changed

Front 45

Account Classification

Back 45

Why you spent the money

Front 46

Source documents

Back 46

Supper the cost principle and everything is verifiable

Hint 46

Receipts

Front 47

Chart of accounts

Back 47

List of accounts to the business

Front 48

Liquidity

Back 48

How fast can you turn assess into cash

Front 49

Journal

Back 49

A record of each days transactions

Front 50

Ledger

Back 50

A collection of records that summarizes for each account the effect of transactions entered into the journal

Front 51

Debit

Back 51

Left side of t-account

Front 52

Credit

Back 52

Right side of t account (money going out)

Front 53

Journal entry

Back 53

An accounting methods for expressing the effects of a transaction in a debits-equal-credit format

Front 54

T- Account

Back 54

Money coming and out in balance

Front 55

Trail balance

Back 55

A list of all accounts with their balances to provide a check on the equality of the debuts and credits

Front 56

Classified balance sheet

Back 56

A balance sheet that classified assets and liabilities into current and other ( long term ) categories

Front 57

Current assets

Back 57

Assets that will be used up or turn into cash with 12 Months of the best operating cycle whichever is longer

Front 58

Current liabilities

Back 58

Short term obligations that will be paid in cash (or fulfilled with other current assets) within 12 months of the operating cycle whichever is longer

Front 59

Non current

Back 59

Long term assets and liabilit that do meet the definition of current