Accounting Quiz
Dividends
A distribution of a portion of a company's earnings to its shareholders.
Expanded Accounting Equation
Assets=Liabilities+Common Stock+Revenues-Expenses-Dividends
Prepaid expenses
Expenses paid in cash before they are used or consumed.
Cash
Money
Retained Earnings
Net income that is kept (retained) in business.
Assets
Resources a company owns
Net loss
The amount by which expenses exceed revenues.
Accounts payable
The amount owed by a company to its creditor.
Income statement
A financial statement that presents the revenues and expenses and resulting net income or net loss of a company for a specific period of time.
Balance sheet
A financial statement that reports the assets, liabilities and stockholders equity at a specific date.
Statement of cash flows
A financial statement that summarizes information about the cash inflows(receipts) and cash outflows (payments) for a specific period of time.
Retained Earnings Statement
A financial statement that summarizes the changes in retained earnings for a specific period of time
Account
A record of increases and decreases in specific asset, liability, or stockholders equity items.
Basic Accounting Formula
Assets=Liabilities+Stockholders equity
Unearned revenues
Cash received before services are performed.
Liabilities
Creditors claims against total assets.
Preferred Stock
Stock that has some preferences over common stock.
Net income
The amount by which revenues exceed expenses.
Salaries and wages payable
The amount of salaries and wages that are owed to employees for work that was performed by the employees in prior periods.
Accounts receivable
The amount owed by customers on account.
Expenses
The cost of assets consumed or services used in the process of earning revenue.
Debit
The left side of the account.
Stockholders equity
The ownership claim on a corporations total assets.
Credit
The right sound of the account.
Revenues
Total amount of money relieved by the company for goods sold or services provided during a certain time period.
Common Stock
Total amount paid in by stockholders for the shares they purchase.
Notes payable
Written promises to pay stated sums of money at future dates.