ALORE
What is the key accounting relationship?
Assets = liabilities + owner's equity
What elements are on a balance sheet?
Assets, liabilities, owner's equity
define balance sheet
To present, as of a certain time (snapshot), the categories of assets available for use by a company and the sources (liabilities and equity) used to obtain those assets.
define liability
an obligation between one party and another not yet completed in the world of accounting
Cash
asset
accounts RECEIVABLE
asset
goodwill and intangibles
asset
investments
asset
plant and equipment
asset
prepaid expenses
asset
inventories
assets
supplies
assets
define income statement
displays the results (all activity) of a flow of transactions over a period of time. Revenues and expenses incurred during a period of operations *shows profitability*
cost of goods sold
expense
rent expense
expense
utilities expense
expense
wages expense
expense
accounts PAYABLE
liability
interest PAYABLE
liability
long term debt
liability
taxes PAYABLE
liability
wages PAYABLE
liability
retained earnings
owner's equity
stock issue
owner's equity
define owner's equity
represents amount of money that would be returned to a company's shareholders if all assets were liquidated and company debt was paid off
define revenues
represents the value of goods or services provided by a company (before expenses)
define expenses
represnet all costs of doing business and are used in order to generate revenue
interest revenue
revenue
sales revenue
revenue
services revenue
revenue
What elements are on the income statement?
revenues, expenses
define assets
tangible or intangible resources owned by the company value in dollars and expected to contribute to future economic benefits
Statement of Cash Flows
the checkbook of a company, cash inflows and outflows
debit
the left side of an account
credit
the right side of an account
t-account
where transactions are posted
