financial accounting

The system that maintains records of a company's operations and then communicates that information to decision makers is referred to as

accounting

Which accounts require a debit entry to increase the account?

cash, utility expense

A journal provides a

chronological record of all transactions affecting a firm

The closing entry for expense accounts involves the following journal entry.

Debit = retained earnings Credit = expenses (remember, it's recording from the company's POV)

Which of the following statements is true?

Income statement accounts are temporary accounts, while balance sheet accounts are permanent accounts.

Which of the following statements is true regarding the post-closing trial balance?

The post-closing trial balance is an internal report prepared as the last step in the accounting cycle.

Using the accounting equation, stockholders' claims on the resources of the corporation can be expressed as

assets - liabilities

Preparing a ____-______ trial balance is the last step in the accounting cycle and occurs after all accounts have been updated with closing journal entries

post-closing

Careers for accounting professionals typically include a choice between public and _______ accounting

private

A journal entry should contain what?

- accounts and amounts debited - accounts and amounts credited - description of the transaction - the date

Wald Corporation's adjusted trial balance shows the following temporary accounts: service revenue: $20,000; salaries expense $8,000; insurance expense: $2,000; utilities expense: $3,000; interest expense $200; and depreciation expense: $1,400. As part of the the closing process, Wald should debit retained earnings for:

14,600

Wald Corporation's adjusted trial balance shows the following temporary accounts: service revenue: $20,000; salaries expense $8,000; insurance expense: $2,000; utilities expense: $3,000; interest expense $200; and depreciation expense: $1,400. As part of the the closing process, Wald should credit retained earnings for:

20,000

Select the accounts that increase with a debit

Advertising expense Supplies Accounts receivable

True or false: A balance sheet is a list of all accounts and their balances showing that debits equals credits

False

Which of the following is an important purpose of GAAP?

It facilitates comparison of financial information among companies.

Which accounts require a credit entry to increase the account?

accounts payable, retained earnings

The entries that transfer the balances of all temporary accounts to retained earnings are referred to as

closing entries

True or false: The term debit means increase, and the term credit means decrease.

false

Companies communicate information about their business activities primarily through

financial statements

The financial statement that is most useful in explaining a company's stock price performance is the

income statement

A company's plans to safeguard company assets and enhance the reliability and accuracy of accounting information are referred to as

internal controls

A transaction is initially recorded in the journal, and then subsequently posted to the general

ledger

The term debit means to place the entry on the _____ hand side of the account, and the term credit means to place the entry on the ____ hand side of the account.

left, right

The two main career paths in accounting are referred to as:

private and public

The purpose of a journal is to

record a chronological listing of every transaction for a company.

Identify accounts that require a credit to increase the account.

revenue, common stock

Closing entries move the balances from the ______ accounts into the Retained Earnings account.

temporary

A bank reconciliation is a procedure used to determine if the cash balance in the bank statement equals

the ending balance of cash in the accounting records.

A list of all accounts and their balances at a particular date showing that debits equal credits is referred to as a(n)

trial balance

True or false: The accounting equation is: Assets = Liabilities + Stockholders' equity.

true

True or false: The fact that all companies use the same accounting rules allows financial statement users to make meaningful comparisons among companies.

true