Accounting Chapter 1

Planning, recording, analyzing, and interpreting financial information

• accounting
• financial statements
• sale on account
• transaction

A business activity that changes assets, liabilities, or owner's equity

• accounting equation
• transaction
• equities
• asset

An equation that shows the relationship among assets, liabilities, and owner's equity.

• Accounting equation
• account balance
• accounting system
• account records

A planned process for providing financial information that will be useful to management

• accounting system
• accounting record
• financial statements
• sale on account

The account used to summarize the owner's equity in the business.

• capital
• revenue
• sale on account
• asset

The amount remaining after the value of all liabilities is subtracted from the value of all assets.

• owner's equity
• liability
• account balance
• expense

A business owned by one person

• proprietorship
• corporation
• partnership
• s-corporation

Anything of value that is OWNED

• asset
• liability
• revenue
• equities

A sale for which cash will be received at a later date

• sale on account
• accounts payable
• liability
• withdrawals

Assets taken out of a business for the owner's personal use

• withdrawals
• revenue
• expenses
• assets