financial accounting
The system that maintains records of a company's operations and then communicates that information to decision makers is referred to as
accounting
Which accounts require a debit entry to increase the account?
cash, utility expense
A journal provides a
chronological record of all transactions affecting a firm
The closing entry for expense accounts involves the following journal entry.
Debit = retained earnings Credit = expenses (remember, it's recording from the company's POV)
Which of the following statements is true?
Income statement accounts are temporary accounts, while balance sheet accounts are permanent accounts.
Which of the following statements is true regarding the post-closing trial balance?
The post-closing trial balance is an internal report prepared as the last step in the accounting cycle.
Using the accounting equation, stockholders' claims on the resources of the corporation can be expressed as
assets - liabilities
Preparing a ____-______ trial balance is the last step in the accounting cycle and occurs after all accounts have been updated with closing journal entries
post-closing
Careers for accounting professionals typically include a choice between public and _______ accounting
private
A journal entry should contain what?
- accounts and amounts debited - accounts and amounts credited - description of the transaction - the date
Wald Corporation's adjusted trial balance shows the following temporary accounts: service revenue: $20,000; salaries expense $8,000; insurance expense: $2,000; utilities expense: $3,000; interest expense $200; and depreciation expense: $1,400. As part of the the closing process, Wald should debit retained earnings for:
14,600
Wald Corporation's adjusted trial balance shows the following temporary accounts: service revenue: $20,000; salaries expense $8,000; insurance expense: $2,000; utilities expense: $3,000; interest expense $200; and depreciation expense: $1,400. As part of the the closing process, Wald should credit retained earnings for:
20,000
Select the accounts that increase with a debit
Advertising expense Supplies Accounts receivable
True or false: A balance sheet is a list of all accounts and their balances showing that debits equals credits
False
Which of the following is an important purpose of GAAP?
It facilitates comparison of financial information among companies.
Which accounts require a credit entry to increase the account?
accounts payable, retained earnings
The entries that transfer the balances of all temporary accounts to retained earnings are referred to as
closing entries
True or false: The term debit means increase, and the term credit means decrease.
false
Companies communicate information about their business activities primarily through
financial statements
The financial statement that is most useful in explaining a company's stock price performance is the
income statement
A company's plans to safeguard company assets and enhance the reliability and accuracy of accounting information are referred to as
internal controls
A transaction is initially recorded in the journal, and then subsequently posted to the general
ledger
The term debit means to place the entry on the _____ hand side of the account, and the term credit means to place the entry on the ____ hand side of the account.
left, right
The two main career paths in accounting are referred to as:
private and public
The purpose of a journal is to
record a chronological listing of every transaction for a company.
Identify accounts that require a credit to increase the account.
revenue, common stock
Closing entries move the balances from the ______ accounts into the Retained Earnings account.
temporary
A bank reconciliation is a procedure used to determine if the cash balance in the bank statement equals
the ending balance of cash in the accounting records.
A list of all accounts and their balances at a particular date showing that debits equal credits is referred to as a(n)
trial balance
True or false: The accounting equation is: Assets = Liabilities + Stockholders' equity.
true
True or false: The fact that all companies use the same accounting rules allows financial statement users to make meaningful comparisons among companies.
true