Accounting

The Securities Exchange Commission (SEC) is concerned with what?

It oversees stock market activity to protect investors' interests.

The chronological record in which transactions are initially recorded in the order in which they occur is called a(n):

Journal

The term for the process of recording business events in a book of original entry is:

Journalizing

The principle of matching is concerned with what?

Matching revenues and expenses together in the same time period.

What organization is primarily responsible for establishing GAAP in the United States? What is the new GAAP called?

FASB in U.S. and IASB comes up with IFRS (International financial reporting standards)

The process of transferring amounts from the book of original entry into specific account records is referred to as:

Posting

Two friends decide to launch a new business by investing $25,000 each in Hot Spot Tanning. They are given shares of stock as evidence of their ownership interest. What effect does this transaction have on the accounting equation?

Increase in assets and equities.

Machinery is purchased on credit. What effect does this transaction have on the accounting equation?

Increase in assets and liabilities.

What is the going concern assumption concerned with?

We assume continuous life of the business, so it would be able to make use of its resources to pay its liabilities

The system of accounting in which there are at least two accounts affected in every transaction so that the accounting equation stays in balance is called:

Double entry

A manager is uncertain about the best estimate time to record revenue for a business Which GAAP offers guidance?

Revenue recognition