What does the mnemonic DEALER represent in accounting?

What is the accounting equation?

Which financial statement shows a company's revenues and expenses for a particular period?

Which financial statement reports a company's assets, liabilities, and equity at a specific point in time?

Which financial statement reports changes in company equity from the opening balance to the end of the period?

Which financial statement reports the sources and uses of cash by a business?

Which list correctly outlines the accounting cycle steps?

If a customer pays at the time of sale, how should the transaction be entered?

If a customer does not pay at the time of sale, how should the transaction be entered?

Once a customer has paid an invoice, which action should be used?

After recording receive payment and sales receipt, what step typically follows?

Step 4 of the accounting cycle—preparing adjusted entries—typically includes which items?

Removing transactions that belong to a different period is known as what?

What is the opposite of a deferral, concerned with future payments or expenses?

Which assumption states that the business is a separate entity from its owners and their other financial activities?

Which assumption requires that only transactions that can be proven—such as with receipts, invoices, or bank statements—are recorded?

Which principle requires that all information relevant and important to lenders or investors be disclosed in the financial statements or notes?

Which assumption selects the option that is least likely to overstate assets and income when choosing between two solutions?

Which principle states that an amount may be ignored if its effect on the financial statements is small and not misleading?

Which principle requires continued application of an adopted accounting method so results are comparable across periods?

Which assumption states that one currency is used throughout accounting activities and inflation is not considered when that currency is used?

Which assumption refers to a business stable enough to operate and meet its obligations in the future?

Revenue is recognized when payment is received and expenses are recognized when paid out

Revenues are reported when they are earned and expenses are reported when they are incurred

A combo of cash-basis and accrual methods

Things your company owns that you can easily convert to cash and expect to do so within the next 12 months

Things your company owns that you expect to have for more than 12 months

The total you get when adding all current assets and all long-term assets. This should equal Total Liabilities+Toal Equity

A physical asset, such as inventory, vehicle, or a building

Not a physical asset. Examples would be a copyright, patent, or brand recognition

A signed document containing a written promise to pay a stated sum to a specified person or bearer at a specified ate or on-demand

Notes Receivable

Notes Payable

Interest Equation

Receivables, loans, or other debits that have virtually no chance of being paid

An expense that a business incurs once the repayment of credit previously extended to a customer is estimated to be uncollectible

A bad debt is charged to expense as soon as it is apparent that an invoice will not be paid. This is easier for business owners.

An estimate of the future amount of bad debt is charged to a reserve account as soon as a sale is made. This is more accurate but complex

A contra-asset account that has a natural credit balance. Balances decrease with debits and increase with credits

An expense account on the income statement showing the cost of merchandise to the business

An inventory system that continuously update the inventory account

An inventory system that updates the inventory account only at specified intervals

Inventory Cost Flows

Method to assign cost to inventory that assumes items are sold in the order acquired; earliest items purchased are the first sold.

Method to assign cost to inventory that assumes costs for the most recent items purchased are sold first and charged to cost of goods sold.

All items in the inventory are priced at their average cost

Closing Inventory

COGS equation

Fixing Journals Entries

Which term describes PP&E (Plants, Property, and Equipment), trademarks, and long-term investments?

Which depreciation method records the same amount of expense each accounting period during an asset's service life?

Which depreciation approach assumes the asset is used more earlier in its life so expense is larger in year 2 than year 4?

Which table shows the depreciation amount over the span of an asset's life?

Which kind of lease does not intend transfer of ownership of the asset?

Which kind of lease intends transfer of ownership of the asset at the end of the lease?

Which category includes a company's liabilities that will come due within one year?

Which account represents money owed by a company to its creditors?

Which account records income taxes payable to state and federal governments on the work performed by employees for that period?

Which liability is created when a business collects cash from customers in advance of completing a service or delivering a product?

Which category describes money owed by the business for more than one year, sometimes called long-term liabilities?

Which liability represents long-term money lent to the firm that must be repaid?

Which concept refers to the expected balance of a particular account type (assets normally debit where debits increase and credits decrease; liabilities normally credit where debits decrease and credits increase)?

Which term means the total amount of an employee’s earnings before deductions are taken out?

Which term means the amount of income left after taxes and deductions have been taken out?

Which term names the period covered by a salary payment?

Which payroll component includes w‑2s, I‑9’s, 1099’s, and w‑4’s?

Which business form is owned and managed by a single individual?

Which business organization is owned by two or more persons who agree on a specific division of responsibilities and profits?

Which entity type is owned by one or more and not personally liable; compensation can be by salary, guaranteed payments, or owners’ draw; amounts may show on the balance sheet or P&L depending on filing?

Which corporation type has one or more shareholders who are not personally liable, must have a board of directors and strict operating rules, and can pay owners as employees or via dividends (salary shows on the balance sheet; dividends show on P&L)?

Which corporation type has owners who are heavily involved and are also employees with reasonable salaries, and pay appears on both the balance sheet and P&L?

Which organization type has one or more owners but no single person or group owns it; it is governed by a board of directors, has no personal liability, and a founder can become a staff employee or executive director to receive pay?

Which reporting system gathers relevant information from within the organization’s own internal operations?

Which reports are produced for use by people outside the organization?

Which term is the reduction of a loan balance through payments made over a period of time?

Which schedule shows each payment’s breakdown between interest and principal and the remaining balance after each payment?

Which loan is used to finance a company’s daily operations?

Which loan indicates the borrower has pledged some asset as collateral?

Which formula defines net assets?

Which records are the original proof that a specific transaction took place?

Which method compares totals listed on source document reports to the totals listed on the balance sheet?

Which process reviews all existing transactions or source documents to confirm they actually occurred?

Which expression gives percent change?

Which analysis technique evaluates a series of financial statement data over a period of time?

Which analysis reports an amount on a financial statement as a percentage of another item on the same financial statement?

Which equation defines net income?

From the table of bookkeeping terms and definitions, choose the term described as “A measure of a company’s profitability. Shows the percentage of revenue that exceeds COGS.”

Select the correct formula labeled in the table as the gross profit margin formula.

In the table, the description “Measures how much profit a company makes on a dollar after paying for employees and overhead” corresponds to which term?

According to the table, which expression represents Operating Profit Margin?

From the table, the phrase “Used to calculate the percentage of profit a company produces from its total revenue” identifies which term?

Choose the correct Net Profit Margin formula shown in the table.

Which term in the table is described as “Analyzes short term financial risk”?

Select the correct Current Ratio formula listed in the table.

From the table, the description “Compares total debt to total equity” corresponds to which ratio?

Choose the formula labeled “Debt to Equity Ratio Formula” in the table.

In the table, select the formula for Accounts Payable Turnover.

Choose the correct formula for Accounts Receivable Turnover Ratio shown in the table.

Select the formula labeled “Cash Flow Coverage Ratio” in the table.

Choose the formula labeled “Current Liability Coverage Ratio” in the table.

Select the formula labeled “Cash Flow Margin Ratio” in the table.

From the table, which term matches the definition “Quantifiable measures of performance used to gauge progress toward strategic objectives or agreed standards of performance”?

According to the 8 Step Payroll Process, which item is listed as step 1? The table displays the following steps: 1. Choose payroll system 2. Create Payroll Policy 3. Gather Employee Info 4. Setup Direct Deposit.

According to the 8 Step Payroll Process, which item is listed as step 3? The table displays the following steps: 1. Choose payroll system 2. Create Payroll Policy 3. Gather Employee Info 4. Setup Direct Deposit.

From the continuation of the 8 Step Payroll Process, which item is listed as step 5? The list shows: 5. Establish Time Tracking System 6. Collect Employee Time Sheets 7. Approve and Submit Employee Payroll 8. Report and Update Payroll records.

According to the list of steps 5–8 in the 8 Step Payroll Process, which item is step 8? The list shows: 5. Establish Time Tracking System 6. Collect Employee Time Sheets 7. Approve and Submit Employee Payroll 8. Report and Update Payroll records.

What is the main purpose of adjusting journal entries at the end of an accounting period?