financial accounting

How do adjusting entries for accrued expenses affect liabilities and expenses?

Adjusting entries for accrued expenses can increase liabilities and increase expenses.

The statement of stockholders' equity includes these amounts:

NI, ending RE, and dividends

To complete the measurement process, companies need to update balances of assets, liabilities, revenues and expenses fo

adjusted

statements of stockholders equity

common stock +retained earnings.

Stockholders' Equity

common stock and retained earnings

assets

money and other valuables belonging to an individual or business

Dividends

Company's share profits to the shareholders based on the corporation's performance.

revenues

The financial resources of the government. The individual income tax and Social Security tax are two major sources of the federal government's revenue.

At year-end, companies that utilize accrual-based accounting systems complete the measurement process through

adjusting entries

whats on the balance sheet

assets, liabilites, and stockholders equity

retained earnings

begining+net income-dividends

If an adjusting entry's credit is to a liability account, then the debit must be to

credit

When a company records an adjusting entry for services previously recorded as Deferred Revenue, it record

debit to derred revenue and cred to revenue

assests divedends expenses

debit up credit down

An adjusting entry is necessary to record interest expense at year-end because the interest:

has already been incured

he expense that relates to notes payable and accumulates or accrues throughout the accounting period is referred to as

interest

circle of finances

investors, make decisons abotu companies, whose activites are measured by financial accountatns, whose information goes back to investors.

credit up debit down.

liabilites stockholders equity and revenues

The two major categories reported in the income statement are:

revenue and expenses

Income Statement

revenue- expenses= net income

Framework for Financial Accounting

two primary funcitons are measurign activities, and communicatign those measurments.

After the adjusting entries have been completed, the adjusted balance in the Supplies Expense account represents the cost of supplies:

used during the accounting period

n an adjusting entry for expenses incurred but not yet paid

will be increased