Chapter 2 accounting
Income Statement
A Financial statement showing the results of business transactions involving revenue and expense accounts over a period of time
Statement of Owners Equity
A financial statement showing the activity in the owners equity or capital account, over the financial period
T account form
A form of account in the shape of a T, which increases and decreases in the account may be recorded.
Trial Balance
A list of all account balances to prove that the total of all debit balances equals the total of all credit balances
Financial Statement
A report prepared by accountants that summarizes the financial affairs of the business
Compound Entry
A transaction that requires more than one debit or more than one credit to be recorded
Slide
An error in placing the decimal point in a number
Transposition
An error that involves interchanging, or switching around, digits during the recording of a number
Profit and loss statement
Another term for income statement
Debit
The Left side on a T account Debits represent increases in... -Asset -Drawing -Expense
Report Form
The form of the balance sheet in which assets are placed at the top and liabilities and owners equity are placed below
Financial Position
The resources or assets owned by an organization at a point in time, offset by the claims against those resources and owners equity, shown on the Balance Sheet
Net Loss
The results when total expenses exceeds total revenue
Net Income
The results when total revenue exceeds total expenses over a period of time
Credit
The right side on a T account Credits represent increases in.. -Liability -Capital -Revenue
Balance Sheet
a financial sheet showing the functional statement showing the financial position of an organization on a given date, such as June 30 or December 31. The balance sheet lists the balances in the asset, liability, and owners equity accounts.
Assets
the left side is the increase side
Drawing
the left side is the increase side
expenses
the left side is the increase side
debit
the left side of the t account
Normal Balance
the plus side of a T account
Capital
the right side is the increase side
Liabilities
the right side is the increase side
Revenue
the right side is the increase side
Footing
the totals of each side of a T account