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Questions and Answers
Questions and Answers
What is an account?
What is an account?
- A record that summarizes all transactions for a single item in the accounting equation (correct)
- The total liabilities of a business
- A type of financial statement
- An expense incurred by a business
What is account balance?
What is account balance?
The difference between the increases and decreases in an account.
What is the account title?
What is the account title?
The name given to an account.
What is accounting?
What is accounting?
What is the accounting equation?
What is the accounting equation?
What is an accounting system?
What is an accounting system?
What is an asset?
What is an asset?
What are business ethics?
What are business ethics?
What is a business plan?
What is a business plan?
What is a capital account?
What is a capital account?
Who is a creditor?
Who is a creditor?
What are equities?
What are equities?
What is equity?
What is equity?
What are ethics?
What are ethics?
What is an expense?
What is an expense?
What are financial statements?
What are financial statements?
What does GAAP stand for?
What does GAAP stand for?
What is a liability?
What is a liability?
What is a net worth statement?
What is a net worth statement?
What is owner's equity?
What is owner's equity?
What is personal net worth?
What is personal net worth?
What is a proprietorship?
What is a proprietorship?
What is revenue?
What is revenue?
What is a sale on account?
What is a sale on account?
What is a service business?
What is a service business?
What is a transaction?
What is a transaction?
What is a withdrawal?
What is a withdrawal?
Questions and Answers
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Flashcards
Flashcards
Account
Account
Summarizes transactions for a specific item in the accounting equation.
Account Balance
Account Balance
The net difference between increases and decreases in an account.
Account Title
Account Title
The designated name of an account.
Accounting
Accounting
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Accounting Equation
Accounting Equation
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Accounting System
Accounting System
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Asset
Asset
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Business Ethics
Business Ethics
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Business Plan
Business Plan
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Capital Account
Capital Account
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Creditor
Creditor
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Equities
Equities
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Equity
Equity
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Ethics
Ethics
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Expense
Expense
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Financial Statements
Financial Statements
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GAAP
GAAP
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Liability
Liability
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Net Worth Statement
Net Worth Statement
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Owner's Equity
Owner's Equity
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Personal Net Worth
Personal Net Worth
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Proprietorship
Proprietorship
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Revenue
Revenue
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Sale on Account
Sale on Account
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Service Business
Service Business
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Transaction
Transaction
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Withdrawal
Withdrawal
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Flashcards
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Study Notes
Study Notes
Accounting Fundamentals
- An account summarizes transactions related to a specific item in the accounting equation.
- Account balance represents the net difference between increases and decreases in an account.
- Account title refers to the designated name of an account.
Accounting Process and Systems
- Accounting involves planning, recording, analyzing, and interpreting financial data.
- The accounting equation illustrates the relationship between assets, liabilities, and owner's equity.
- An accounting system is a structured method for compiling financial data and summarizing results in reports.
Key Financial Concepts
- An asset is any valuable item owned by an entity.
- Business ethics apply moral principles to business decision-making.
- A business plan is a written document outlining a business's nature and operational strategy.
- The capital account summarizes the owner's equity in a business.
Financial Obligations and Rights
- A creditor is an entity owed money or an obligation.
- Equities signify financial rights associated with a business's assets.
- Equity is calculated as the difference between total assets and total liabilities.
- Ethics guide right and wrong decision-making processes.
Operational Costs and Financial Reporting
- An expense is related to costs incurred for goods or services in running a business.
- Financial statements detail a business's financial status and operations.
- GAAP stands for Generally Accepted Accounting Principles, dictating standards for financial recording and reporting.
Liabilities and Personal Financial Position
- A liability denotes any amount owed to external parties.
- A net worth statement reports individual assets, liabilities, and their difference.
- Owner's equity is the residual amount after deducting liabilities from total assets.
- Personal net worth evaluates the difference between personal assets and liabilities.
Business Ownership Models
- A proprietorship refers to a business owned by a single individual.
- Revenue represents increases in equity from selling goods or services.
- A sale on account indicates a transaction where payment is due at a future date.
- A service business provides paid activities rather than goods.
Transaction and Withdrawal Definitions
- A transaction constitutes any business action affecting assets, liabilities, or equity.
- A withdrawal involves assets taken for the owner's personal use.
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