Which term refers to financial reports that summarize the financial condition and operations of a business?

What is the term for anything of value that is owned?

What is the difference between personal assets and personal liabilities called?

What is the formal written document that describes the nature of a business and how it will operate?

Accounting is the language of business.

A creditor would favor a positive net worth.

The principles of right and wrong that guide an individual in making personal decisions is called business ethics.

Keeping personal and business records separate is an application of the business entity concept.

Generally Accepted Accounting Principles, GAAP, allows for flexibility in reporting.

Recording business costs in terms of hours required to complete projects is an application of the unit of measurement concept.

Assets such as cash and supplies have value because they can be used to acquire other assets or be used to operate a business.

The relationship among assets, liabilities, and owner’s equity can be written as an equation.

The accounting equation does not have to be in balance to be correct.

When a company pays insurance premiums in advance to an insurer, it records the payment as a liability because the insurer owes future coverage.

When items are bought and paid for later, this is referred to as buying on account.

When cash is paid on account, a liability is increased.

When cash is received from a sale, the total amount of both assets and owner’s equity is increased.

The accounting concept Realization of Revenue is applied when revenue is recorded at the time goods or services are sold.

When cash is paid for expenses, the business has more equity.

If two amounts are recorded on the same side of the accounting equation, the equation will no longer be in balance.

When a company receives cash from a customer for a prior sale, the transaction increases the cash account balance and increases the accounts receivable balance.

A withdrawal decreases owner’s equity.

A creditor would favor a positive net worth.

The accounting equation does not have to be in balance to be correct.

When cash is received from a sale, the total amount of both assets and owner's equity is increased.

When a company receives cash from a customer for a prior sale, the transaction increases the cash account balance and increases the accounts receivable balance

A planned process designed to compile financial data and summarize the results in accounting records and reports

A formal report that shows what an individual owns, what an individual owes, and the difference between the two

An amount owed.

The difference between assets and liabilities.

The principles of right and wrong that guide an individual in making decisions.

The use of ethics in making business decision.

A business that performs an activity for a fee.

A business owned by one person

Generally Accepted Accounting Principles. The standards and rules that accountants follow while recording and reporting financial activities.

Financial rights to the assets of a business.

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

The equation showing the relationship among assets, liabilities, and owner's equity.

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

A record that summarizes all the transactions pertaining to a single item in the accounting equation.

The name given to an account.

The difference between the increases and decreases in an account

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

A person or business to whom a liability is owed

An increase in equity resulting from the sale of goods or services.

A sale for which payment will be received at a later date.

The cost of goods or services used to operate a business.

Assets taken from the business for the owner's personal use.