Accounting Chapter 1

"how much in resources"

Assets

Where can you find it? Income tax payable

Balance Sheet

Where can you find it? Total Assets

Balance Sheet

Statement of RE Equation

Ending RE=Beginning RE+NI-D

"how much assets do stockholders own"

Equity

Insider claims of a business

Equity

Responsibilities of the members of society to each other

Ethical Duties

"how much to creditors"

Liabilities

Where can you find it? Dividends

Statement of retained earnings and Statement of cash flows

The primary objective of financial reporting is to provide information

useful for making investment and credit decisions.

Balance Sheet Equation

A=L+SE

Economic resources that are expected to produce a benefits in the future

Asset

Identify each item with its appropriate financial​ statement, using the following​ abbreviations: Income statement​ (I), Statement of retained earnings​ (R), Balance sheet​ (B), and Statement of cash flows​ (C) Accounts Payable

B

Identify each item with its appropriate financial​ statement, using the following​ abbreviations: Income statement​ (I), Statement of retained earnings​ (R), Balance sheet​ (B), and Statement of cash flows​ (C) Common Stock

B

Identify each item with its appropriate financial​ statement, using the following​ abbreviations: Income statement​ (I), Statement of retained earnings​ (R), Balance sheet​ (B), and Statement of cash flows​ (C) Inventory

B

Identify each item with its appropriate financial​ statement, using the following​ abbreviations: Income statement​ (I), Statement of retained earnings​ (R), Balance sheet​ (B), and Statement of cash flows​ (C) Long-Term Debt

B

Indicate which financial statement would most likely be used to provide the information. Use the following​ abbreviations: Income statement​ (I), Statement of retained earnings​ (R), Balance sheet​ (B), and Statement of cash flows​ (C). How much in total debt does the company have?

B

Indicate which financial statement would most likely be used to provide the information. Use the following​ abbreviations: Income statement​ (I), Statement of retained earnings​ (R), Balance sheet​ (B), and Statement of cash flows​ (C). What assets does the company have?

B

Indicate which financial statement would most likely be used to provide the information. Use the following​ abbreviations: Income statement​ (I), Statement of retained earnings​ (R), Balance sheet​ (B), and Statement of cash flows​ (C). What is the company's financial position at the end of the year?

B

Identify each item with its appropriate financial​ statement, using the following​ abbreviations: Income statement​ (I), Statement of retained earnings​ (R), Balance sheet​ (B), and Statement of cash flows​ (C) Cash

B, C

Identify each item with its appropriate financial​ statement, using the following​ abbreviations: Income statement​ (I), Statement of retained earnings​ (R), Balance sheet​ (B), and Statement of cash flows​ (C) Retained Earnings

B, R

Also called the statement of financial position

Balance Sheet

Where can you find it? Common Stock

Balance Sheet

Where can you find it? Current Liabilities

Balance Sheet

Where can you find it? Long-term Debt

Balance Sheet

Where can you find it? Ending Cash Balance

Balance sheet and Statement of cash flows

Where can you find it? Ending balance of retained earnings

Balance sheet and Statement of retained earnings

Mechanical part of accounting

Bookkeeping

Identify each item with its appropriate financial​ statement, using the following​ abbreviations: Income statement​ (I), Statement of retained earnings​ (R), Balance sheet​ (B), and Statement of cash flows​ (C) +-Cash

C

Identify each item with its appropriate financial​ statement, using the following​ abbreviations: Income statement​ (I), Statement of retained earnings​ (R), Balance sheet​ (B), and Statement of cash flows​ (C) Net cash provided by operating activities

C

Identify each item with its appropriate financial​ statement, using the following​ abbreviations: Income statement​ (I), Statement of retained earnings​ (R), Balance sheet​ (B), and Statement of cash flows​ (C) Net cash used for financing activities

C

Indicate which financial statement would most likely be used to provide the information. Use the following​ abbreviations: Income statement​ (I), Statement of retained earnings​ (R), Balance sheet​ (B), and Statement of cash flows​ (C). How much cash did the company generate and spend during the year?

C

Indicate which financial statement would most likely be used to provide the information. Use the following​ abbreviations: Income statement​ (I), Statement of retained earnings​ (R), Balance sheet​ (B), and Statement of cash flows​ (C). How much cash was generated by operating activities?

C

Identify each item with its appropriate financial​ statement, using the following​ abbreviations: Income statement​ (I), Statement of retained earnings​ (R), Balance sheet​ (B), and Statement of cash flows​ (C) Net Income

C, I, R

Identify each item with its appropriate financial​ statement, using the following​ abbreviations: Income statement​ (I), Statement of retained earnings​ (R), Balance sheet​ (B), and Statement of cash flows​ (C) Dividends

C, R

Owned by stockholders whose liability is limited to the amount they have invested in the business

Corporation

Costs of doing business

Expenses

Provides information for decision makers outside of the organization

Financial Accounting

Assets are usually reported at their

Historical Cost

States that assets should be recorded at their actual cost on the date of purchase

Historical Cost Principle

Identify each item with its appropriate financial​ statement, using the following​ abbreviations: Income statement​ (I), Statement of retained earnings​ (R), Balance sheet​ (B), and Statement of cash flows​ (C) Interest Revenue

I

Identify each item with its appropriate financial​ statement, using the following​ abbreviations: Income statement​ (I), Statement of retained earnings​ (R), Balance sheet​ (B), and Statement of cash flows​ (C) Salary Expense

I

Identify each item with its appropriate financial​ statement, using the following​ abbreviations: Income statement​ (I), Statement of retained earnings​ (R), Balance sheet​ (B), and Statement of cash flows​ (C) Sales Revenue

I

Indicate which financial statement would most likely be used to provide the information. Use the following​ abbreviations: Income statement​ (I), Statement of retained earnings​ (R), Balance sheet​ (B), and Statement of cash flows​ (C). What were the company's net sales for the year?

I

Indicate which financial statement would most likely be used to provide the information. Use the following​ abbreviations: Income statement​ (I), Statement of retained earnings​ (R), Balance sheet​ (B), and Statement of cash flows​ (C). How well did the company perform during the year?

I

Answers the question "How well did the company perform during the period?"

Income Statement

Where can you find it? Income tax expense

Income Statement

Where can you find it? Selling, general, and administrative expense

Income Statement

Where can you find it? Revenue

Income Statement

Where can you find it? Net Income

Income statement, Statement of retained earnings, and Statement of cash flows

Entities that provide money to finance a company's operations

Investors and Creditors

A debt payable to an outsider

Liability

Provides information for managers of the organization

Managerial Accounting

Income Statement Equation

NI=R-E

Total revenues less total expenses

Net Income

What does equity include?

Paid-in capital & Retained Earnings

A business organization form with two or more owners who are each personally liable for all of the business's debts

Partnership

A business organization form with a single owner who is personally liable for all of the business's debts

Proprietership

Indicate which financial statement would most likely be used to provide the information. Use the following​ abbreviations: Income statement​ (I), Statement of retained earnings​ (R), Balance sheet​ (B), and Statement of cash flows​ (C). Did the company declare a dividend during the year?

R

Indicate which financial statement would most likely be used to provide the information. Use the following​ abbreviations: Income statement​ (I), Statement of retained earnings​ (R), Balance sheet​ (B), and Statement of cash flows​ (C). Why did the company's retained earnings change during the year?

R

Inflows of resources resulting from delivering goods or services to customers

Revenues

Reports cash flows from operating, investing, and financing activities

Statement of Cash Flows

Where can you find it? Adjustments to reconcile net income to net cash provided by operations

Statement of Cash Flows

Where can you find it? Cash spent to acquire the building

Statement of Cash Flows

The amount a company expects to collect from customers appears on the

balance sheet in the current assets section.

Revenues are

increases in retained earnings resulting from selling products or performing services.