Final Exam Review (Accounting Fall 2024)

Front

______________ is the process of recording, maintaining, and reporting an organization’s financial transactions and records.

Back

Accounting

Front

The ____________ are a commonly-followed set of accounting rules, standards, and procedures for reporting financial information to external users.

Back

Generally Accepted Accounting Principles (GAAP)

Front

The ____________ means revenues and expenses are recognized and recorded when cash actually changes hands.

Back

Cash accounting method

Front

The ____________ means revenues and expenses are recognized and recorded at the time they are earned or incurred, even if money doesn’t change hands.

Back

Accrual accounting method

Front

When using the accrual basis of accounting, revenues must be recognized (recorded) in the period when they are earned. If accounting on a cash basis, revenues are to be recognized when cash is received. Which accounting principle is applied?

Back

Revenue recognition principle

Front

In any business, the _______ of a company always have the first financial claim on the assets of a company.

Back

Creditors

Front

Which equation below is the accounting equation? Assets = Liabilities - Owners’ Equity, Assets = Owners’ Equity/Liabilities, Assets = Liabilities + Owners’ Equity

Back

Assets = Liabilities + Owners’ Equity

Front

Owners’ Equity is a(n):

Back

Owner’s claim on company assets after all liabilities have been paid.

Front

A _______ is a financial statement that marks a company’s financial situation at a moment in time, showing all assets, liabilities and owner’s equity.

Back

Balance Sheet

Front

No matter the mix of liabilities and owner’s equity, the sum of liabilities and owner’s equity will ALWAYS be equal to the ____________ a company owns.

Back

Total Assets