Accountin test 6 vocab

6. Reporting income when it is earned and expenses when they are incurred. (p. 163)

accrual basis of accounting

13. Journal entries recorded to update general ledger accounts at the end of a fiscal period. (p. 176)

adjusting entries

8. Changes recorded on a work sheet to update general ledger accounts at the end of a fiscal period. (p. 163)

adjustments

9. A financial statement that reports assets, liabilities, and owner's equity on a specific date. (p. 169)

balance sheet

7. Reporting income when the cash is received and expenses when the cash is paid. (p. 163)

cash basis of accounting

1. The length of time for which a business summarizes its financial information and reports its financial performance. (p. 159)

fiscal period

2. A fiscal period consisting of 12 consecutive months. (p. 159)

fiscal year

10. A financial statement showing the revenue and expenses for a fiscal period. (p. 170)

income statement

11. The difference between total revenue and total expenses when total revenue is greater. (p. 171)

net income

12. The difference between total revenue and total expenses when total expenses are greater. (p. 172)

net loss

5. Cash paid for an expense in one fiscal period that is not used until a later period. (p. 163)

prepaid expense

4. A proof of equality of debits and credits in a general ledger. (p. 160)

trial balance

3. A columnar accounting form used to summarize the general ledger information needed to prepare financial statements. (p. 159)

work sheet