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Description
Flashcards by Amber Harper-Slaboszewicz, updated more than 1 year ago
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Created by Amber Harper-Slaboszewicz
over 7 years ago
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| Question | Answer |
| Accounting | Process of identifying, recording, and summarizing economic information and reporting it to decision makers |
| Accounting System | Process an organization uses to record financial data and make financial statements |
| Annual Report | Prepared by management Shows organizations past performance and future prospects |
| Form 10K | Filed annually with the SEC |
| Balance Sheet | Shows the financial status of an organization at a moment in time |
| Assets | Resources |
| Liabilities | Obligations |
| Note Payable | Shows evidence of a debt and describes payment terms |
| Owner's Equity | Owner's claim on an organization's assets Also called "Net Assets" |
| Net Assets | Assets-liabilities |
| Long-Lived Asset | An asset expected to last one year or longer |
| Account | Summary Record |
| Inventory | Goods help by organization meant for sale to customers |
| Open Account | Buying/Selling on credit |
| Account Payable | A liability from an open account transaction |
| Compound Entry | Transaction that affects 2+ accounts |
| Creditor | Entity to whom an organization owes money |
| Sole Proprietership | Business with a single owner |
| Partnership | 2+ individuals as co-owners |
| Corporation | Business organization created by individual state laws |
| LLC | Limited Liability Corporation Creditors generally have claims against corporate assets only Corporations are automatically limited in liability |
| Privately Owned | Shares are not sold publicly Also called "closely held" or "unlisted" |
| Stock Certificate | Formal evidence of ownership Also lists par value |
| Stockholders' Equity | Owners' Equity in a Corporation |
| Paid-In Capital | Total owner capital investment in a corporation |
| Paid-In Capital in Excess of Par Value | a=average price/share b=par value/share c=# shares issued ac=bc+c(a-b) |
| Common Stockholders | Owners with residual claims against the organization's assets |
| Board of Directors | Elected by stockholders to represent them |
| GAAP | Generally Accepted Accounting Principles |
| US GAAP Oversight | Congress \/ SEC \/ FASB |
| FASB | Financial Accounting Standards Board Independent body that establishes US GAAP |
| IFRS | International Financial Reporting Standards Established by IASB |
| IASB | International Accounting Standards Board |
| Auditor | Assesses credibility of financial data |
| Public Accountants | Offer services to the public for a fee |
| CPA | Certified Public Accountant Must meet standards set by state Board of Accountancy |
| Who can issue official opinions on financial statements? | CPAs |
| AICPA | American Institute of Certified Public Accountants CPA Professional Organization |
| IAASB | International Auditing and Assurance Standards Board Goal of standardizing audit regulations globally |
| PCAOB | Public Company Accounting Oversight Board |
| Sarbanes-Oxley Act | 2002 Established PCAOB Prohibited public accounting firms from providing certain non-audit services to audit clients Every 5 years, lead partner and reviewing partner on an audit must switch |
| GAAS | Generally Accepted Auditing Standards Minimum steps for an auditor to take to have a good shot @ finding errors and omissions |
| GASB | Government Agency Standards Board |
| Operating Cycle | Time between acquiring goods/services in cash and sale of products for cash |
| Fiscal Year | Year established for accounting purposes |
| Revenue | Increase in net assets from a sale. Increases owner equity. |
| Expense | Cost of providing goods or services - decreases owner equity |
| Income | Revenue - Expenses |
| Retained Income | Total cumulative owners' equity generated by profits |
| Accounts Receivable | Amounts owed to company by customers in exchange for goods and services |
| Cost of Goods Sold | Original acquisition cost of inventory sold to customers in a reporting period |
| Accrual Accounting | Record transaction as it occurs |
| Cash Accounting | Record transaction when cash is received |
| Matching | Recording expenses in the same time period that we recognize the related revenues |
| Product Costs | Costs linked to revenue |
| Period Costs | Linked to the passage of time |
| Depreciation | Systematic allocation of acquisition costs of a long-lived asset Total Cost/Months of expected use |
| Income Statement | Report of all revenues and expenses in a reporting period |
| Net Income | "Bottom Line" revenue-expenses |
| Net loss | negative net income |
| Cash Dividends | Distributions of cash to stockholders Reduce retained earnings |
| Statement of Stockholders' Equity | Statement of all changes in a year to the equity account |
| 3 steps to a cash dividend | 1. Declaration Date - board announces intent to pay 2. Record Date - if you hold stock on this date, you get dividend 3. Payment Date - dividends are paid |
| Accumulated Deficit | Negative retained earnings |
| EPS | Earnings Per Share Net Income/Shares Available |
| P-E Ratio | Price-Earnings Ratio Price per Share/EPS |
| Dividend-Yield | Divident Yield=Dividends per Share/Stock Price |
| Divident-Payout | Divident-Payout=Dividends per Share/EPS |
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