The standards and rules that accountants follow while recording financial activities are called

Anything of value that is owned is called an asset.

When an owner withdrawals cash from the business, the transaction affects both assets, and owner's equity

The Accounting Equation is most often stated as

A withdrawal is an expense

Each liability account has a normal debit balance.

The balance of an account increases on the same side as the normal balance.

Decreases on the liability side are recorded on the credit side.

The account Prepaid Insurance's normal balance is a

A list of accounts used by a business is called a

A drawing account is increased by debits and decreased by credits.

Amounts to be received in the future due to the sale of goods or services is called

A business form giving written acknowledgement for cash received is called a

The Objective Evidence Concept requires proof that a transaction did occur

What accounts would be debited and credited if a company bought supplies on account from the Casey Company?

A calculator tape is the source document for daily sales.

To correct an error in a journal, one can simply erase the incorrect item and write the correct item

What is the recording of debit and credit parts of a transaction called?

When an entry in an amount column in an even dollar amount either "00" or "--" can be entered in the cents column.

The first digit in the account number 520 means that the account is in the

When adding a new expense account between account numbers 510 and 520 the account is assigned the account number 515.

Determining that the amount of cash agrees with the accounting records

If an error requires a correcting entry, the source document describing the correction to be made is a

When posting is complete the Post Ref column in the General Journal is completely filled in with account numbers.

The last step in the posting process is to

A(n) ____________________ in the journal's Post Ref. Column shows what account the transaction was posted to.

An endorsement indicating a new owner of a check is a

A report of deposits, withdrawals, and bank balances sent to a depositor by a bank is a

A check that a bank refuses to pay is a

When Petty Cash is replenished Petty Cash is debited and Cash is credited.

A lost check with a _______________ on it can be cashed by anyone.

Cash Short and Over is classified as an

An outstanding check is one that has been issued but not yet reported on a bank statement.

A check with a future date on it is called a

A proof of the equality of debits and credits in a general ledger is a

Reporting income when it is earned and expenses when they are incurred is called

_____________ are changes recorded on a worksheet to update general ledger accounts at the end if a fiscal period.

Adjustments are changes recorded on a worksheet to update general ledger accounts at the end of a

If an amount is written in an incorrect column of a worksheet, the error should be erased and the amounts should be written in the correct column.

Journals, ledgers, and worksheets are considered permanent records.

A financial statement showing the revenue and expenses for a fiscal period is an

A financial statement that reports the value of a business' assets, liabilities, and owner's equity on a specific date is a

What is included in the heading of a worksheet?

The formula for calculating the Net Income Ratio is net income divided by total sales

When preparing a Statement of Owner's Equity, the amount of current owner's capital is calculated using amounts obtained from the

Preparing financial statements at the end of each monthly fiscal period is an application of the account concept of

If a business has a net loss for the period, expenses should be reported before revenues on the income statement.

Assuming that financial statements contain all information necessary to understand a business' financial condition is an application of the accounting concept

Income Summary is a _____________ account.

The ending account balances of permanent accounts for one fiscal period are the beginning account balances for the next fiscal period.

The last step in the Accounting Cycle is to prepare the Post-Closing Trial Balance

The drawing account is a permanent account.

The journal entry to close Income Summary when there us a net income is

A columnar accounting form used to summarize the General Ledger information needed to prepare financial statements is a

After the closing entries are posted, the Owner's Drawing Account should be

The balances of the asset accounts must be reduced to zero to prepare the accounts for the next period.