Flashcards
Glossary of Accounting Terms
Cards in this deck (29)
- 1Accounta form in which changes caused by transactions are recorded
- 2Accounting cycle:the set of accounting procedures performed in each accounting period.
- 3Accounting PeriodThe period of time covered by the financial statements. AKA "fiscal period"
- 4Accural basis of accountingThe system under which revenue is recorded when earned and expenses are recorded when incurred.
- 5Balance Sheet EquationAssets = Liabilities + Owner's Equity
- 6Book valuethe cost of an asset minus the accumulated depreciation
- 7Business Equity Principle:states that each business is considered a separate entity, and the financial data for the business must be kept separate from the owner's personal financial data.
- 8Contra Accountan account that reduces the value of the account it is "linked" to.
- 9Cost principle:States that assets must be shown on the balance sheet using the cost the were purchased for.
- 10Credit Invoice (source document)issued by the seller to the customer for returned goods (for credit)
- 11Current ratio:current assets
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current liabilities - 12Debt ratio:Total Liabilities
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Total Assets - 13Declining balance depreciation:Method of calculating depreciation
Book Value = Cost − Accumulated Depreciation
Then multiply that by the rate. - 14Double entry accounting:a system of accounting where debits must equal credits for each transaction
- 15Equity ratio:Owner's Equity
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Total Assets - 16General partnershipa partnership where all partners have unlimited liability.
- 17GAAPGeneral Accepted Accounting Principles. Standard accounting rules and guidelines
- 18HST13% TAX
- 19limited partnership:a form of partnership where there is a limited partner (with limited personal liabilities) and a general partner.
- 20Matching Principle:States that expenses for a fiscal period must match the revenue generated in that same period to give an accurate net income.
- 21Principle of Materiality:states that information that could affect the decisions of users of financial statements should be included when financial statements are prepared.
- 22Merchandise Turnover FormulaCost of Goods Sold
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Average Inventory - 23Principle of Objectivity:States that accounting records should be based on the objective evidence provided by source documents to support the values used in recording transactions.
- 24Periodic Inventory Method:merchandise purchases are recorded in the purchases account, and the inventory account balance is updated only at the end of each accounting period (Has purchase returns)
- 25Perpetual Inventory Method:Requires a continuous record of all merchandise on hand updated when ever a transaction occurs.
COGS is an account - 26Petty Cash fund:an amount of cash used to make small payments. All payments must be matched to a voucher
- 27Quick Ratio:Cash - Accounts Rec. - Stocks/Bonds
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Current Liabilites - 28Bank Reconciliation Statement:Brings the banks records into agreement with your own records.
- 29Time Period Principle:The definite and consistent used of the same accounting period.
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- Grade 11 Accounting Flashcards on Glossary of Accounting Terms, created by racheloucks on 24/06/2013.
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