When a business issues common stock, what does it give to its owners? Account Receivable. Transferring entries from the journal to the ledger is called _______. In what respects would you agree with this description? Questions: Accounting has often been called the language of business. The effect on the accounting equation effect is _____. Chapter 14: Corporate Equity Accounting ; Chapters 15-16 Using Information. Match. what is the type of activity and effect on cash for this transaction: Borrowed $40 from banks due in two years. then you must include on every physical page the following attribution: If you are redistributing all or part of this book in a digital format, Key Concepts: Terms in this set (52) Z Best, Inc. issued 1,000,000 shares of $1 par value common stock for $20,000,000 in cash. For accounting information to be relevant, the information should _____ (2 things), allow users to predict future events of the business, allow users to assess past activities of the business. Chapter 15: Financial Reporting and Concepts ; Chapter 16: Financial Analysis and the Statement of Cash Flows ; Chapters 17-20 Managerial/Cost. Account. Both revenues and gains represent inflows to the business, making it more valuable. The effect on the accounting equation effect is ______. Answers will vary and should include a combination of revenues/gains (increases), expenses/losses (decreases), investments (increases), and distributions (decreases). This is important to stakeholders because revenues represent ongoing or permanent activities, while gains represent infrequent or transient activities. Preview tekst. CHAPTER 3 / Financial Accounting and the Operating Cycle 75 AP 3–2 Inaknot Insurance Corporation General Journal Dec. 2011 Description F Debit Credit Adjusting Entries a. Dec. 31 Unused Supplies 173 200 Supplies Expense 668 200 b. not be reproduced without the prior and express written consent of Rice University. 31 Insurance Expense 631 450 Prepaid Insurance 161 450 c. 31 Depreciation Expense—Truck 624 1,500 Accumulated Depreciation—Truck 194 1,500 ($18,000 x 6/72 … accounting equation stays in balance w/ each transaction, every transaction affects at least 2 accounts. corasusername. transaction analysis is based on what two principles? Learn. what action is done to update account balances? Why It Matters; 1.1 Explain the Importance of Accounting and Distinguish between Financial and Managerial Accounting; 1.2 Identify Users of Accounting Information and How They Apply Information; 1.3 Describe Typical Accounting Activities and the Role Accountants Play in Identifying, Recording, and Reporting Financial Activities; 1.4 Explain Why Accounting Is Important to Business Stakeholders As soon as it receives the supplies in May, Pizza Aroma should record: represents a ledger account and is a tool used to understand the effects of 1 or more transactions, Faithful representation exists when the information is ______. A T-account is a simplified representation of a ______. Gravity. UGC NET COMMERCE PAPER 2/3 Previous Question Papers with Answers/ Syllabus; Dr. Libison K B 1st Sem BCom Managerial Economics Virtual Learning Space; Dr. Libison K B 2nd Sem BCom Marketing Management Virtual Learning Space (Calicut University) Dr. Libison K B 4th Sem BCom Banking and Insurance Virtual Learning Space (Calicut University) Dr. Libison K B 5th Sem BCom Fundamentals of … When entering a transaction into a general journal, the account(s) _____ would be listed first and then the account(s) ____ would be listed next. Stakeholders should focus on permanent earnings and put peripheral or incidental earnings into the proper context. This book is Creative Commons Attribution-NonCommercial-ShareAlike License Stockholders' equity is the residual interest in the assets of the entity after subtracting _____, After entering a transaction into the accounting equation, an increase in total assets can be accompanied by a(n) (increase/decrease). Chapter 17: Introduction to Managerial Accounting ; Chapter 18: Cost-Volume-Profit and Business Scalability An accounting form that is used to record the increases and de… A claim against the customer created by selling merchandise or… The resources owned by a business. Test. Additional Paid-in Capital is increased by $19,000,000. Increases in … Revenues and investments increase equity, while expenses and distributions decrease equity. Choose from 500 different sets of financial accounting chapter 2 flashcards on Quizlet. citation tool such as, Authors: Mitchell Franklin, Patty Graybeal, Dixon Cooper, Book title: Principles of Accounting, Volume 1: Financial Accounting. Z Best, Inc. issued $1,000,000 of stock for cash. Textbook content produced by OpenStax is licensed under a The ability to confirm past events and to predict future activities are components of which primary qualitative characteristic? A company records the effects of transactions for a particular item in a(n) ______. As a result of this entry, ______. PLAY. Both tangible and intangible assets have value to the company and can be bought, sold, or impaired; tangible assets have physical substance, while intangible assets do not. If you are redistributing all or part of this book in a print format, Financial Accounting - Chapter 2: Analyzing Transactions. covers, OpenStax CNX name, and OpenStax CNX logo are not subject to the Creative Commons license and may The OpenStax name, OpenStax logo, OpenStax book Chapter 2, E 7. a. Which accounting assumption states that financial statement elements should be measured in terms of the United States dollar? 4.0 and you must attribute OpenStax. Unit 2: Accounting Principles and Practices. the line item, equipment, on the balance sheet results from what kind of activity? STUDY. Z Best, Inc. issued 1,000,000 shares of $1 par value common stock for $20,000,000 in cash. transactions are recorded chronologically in the _____. The difference between the total sum of the debits and the tot… Account. steps for entering a transaction in the general journal. financial accounting chapter 2. Seminar assignments Financial Accounting for IB, Answers Tutorial Problem Week 2 Answers Tutorial After Week 7 Seminar assignments - Practical Week 47 answers Seminar assignments - Template for Financial Accounting exam exercise Seminar assignments - Chapter 6 Seminar assignments - week 47,49 - 51. (3 things). Assets = Liabilities + Owner’s Equity. Equity is the net worth of the business. Except where otherwise noted, textbooks on this site The effect of this transaction on the accounting equation is to cause Common Stock to ______. (Check all that apply. are licensed under a, Explain the Importance of Accounting and Distinguish between Financial and Managerial Accounting, Identify Users of Accounting Information and How They Apply Information, Describe Typical Accounting Activities and the Role Accountants Play in Identifying, Recording, and Reporting Financial Activities, Explain Why Accounting Is Important to Business Stakeholders, Describe the Varied Career Paths Open to Individuals with an Accounting Education, Describe the Income Statement, Statement of Owner’s Equity, Balance Sheet, and Statement of Cash Flows, and How They Interrelate, Define, Explain, and Provide Examples of Current and Noncurrent Assets, Current and Noncurrent Liabilities, Equity, Revenues, and Expenses, Prepare an Income Statement, Statement of Owner’s Equity, and Balance Sheet, Describe Principles, Assumptions, and Concepts of Accounting and Their Relationship to Financial Statements, Define and Describe the Expanded Accounting Equation and Its Relationship to Analyzing Transactions, Define and Describe the Initial Steps in the Accounting Cycle, Analyze Business Transactions Using the Accounting Equation and Show the Impact of Business Transactions on Financial Statements, Use Journal Entries to Record Transactions and Post to T-Accounts, Explain the Concepts and Guidelines Affecting Adjusting Entries, Discuss the Adjustment Process and Illustrate Common Types of Adjusting Entries, Record and Post the Common Types of Adjusting Entries, Use the Ledger Balances to Prepare an Adjusted Trial Balance, Prepare Financial Statements Using the Adjusted Trial Balance, Describe and Prepare Closing Entries for a Business, Apply the Results from the Adjusted Trial Balance to Compute Current Ratio and Working Capital Balance, and Explain How These Measures Represent Liquidity, Appendix: Complete a Comprehensive Accounting Cycle for a Business, Compare and Contrast Merchandising versus Service Activities and Transactions, Compare and Contrast Perpetual versus Periodic Inventory Systems, Analyze and Record Transactions for Merchandise Purchases Using the Perpetual Inventory System, Analyze and Record Transactions for the Sale of Merchandise Using the Perpetual Inventory System, Discuss and Record Transactions Applying the Two Commonly Used Freight-In Methods, Describe and Prepare Multi-Step and Simple Income Statements for Merchandising Companies, Appendix: Analyze and Record Transactions for Merchandise Purchases and Sales Using the Periodic Inventory System, Define and Describe the Components of an Accounting Information System, Describe and Explain the Purpose of Special Journals and Their Importance to Stakeholders, Analyze and Journalize Transactions Using Special Journals, Describe Career Paths Open to Individuals with a Joint Education in Accounting and Information Systems, Analyze Fraud in the Accounting Workplace, Define and Explain Internal Controls and Their Purpose within an Organization, Describe Internal Controls within an Organization, Define the Purpose and Use of a Petty Cash Fund, and Prepare Petty Cash Journal Entries, Discuss Management Responsibilities for Maintaining Internal Controls within an Organization, Define the Purpose of a Bank Reconciliation, and Prepare a Bank Reconciliation and Its Associated Journal Entries, Describe Fraud in Financial Statements and Sarbanes-Oxley Act Requirements, Explain the Revenue Recognition Principle and How It Relates to Current and Future Sales and Purchase Transactions, Account for Uncollectible Accounts Using the Balance Sheet and Income Statement Approaches, Determine the Efficiency of Receivables Management Using Financial Ratios, Discuss the Role of Accounting for Receivables in Earnings Management, Apply Revenue Recognition Principles to Long-Term Projects, Explain How Notes Receivable and Accounts Receivable Differ, Appendix: Comprehensive Example of Bad Debt Estimation, Describe and Demonstrate the Basic Inventory Valuation Methods and Their Cost Flow Assumptions, Calculate the Cost of Goods Sold and Ending Inventory Using the Periodic Method, Calculate the Cost of Goods Sold and Ending Inventory Using the Perpetual Method, Explain and Demonstrate the Impact of Inventory Valuation Errors on the Income Statement and Balance Sheet, Examine the Efficiency of Inventory Management Using Financial Ratios, Distinguish between Tangible and Intangible Assets, Analyze and Classify Capitalized Costs versus Expenses, Explain and Apply Depreciation Methods to Allocate Capitalized Costs, Describe Accounting for Intangible Assets and Record Related Transactions, Describe Some Special Issues in Accounting for Long-Term Assets, Identify and Describe Current Liabilities, Analyze, Journalize, and Report Current Liabilities, Define and Apply Accounting Treatment for Contingent Liabilities, Prepare Journal Entries to Record Short-Term Notes Payable, Record Transactions Incurred in Preparing Payroll, Explain the Pricing of Long-Term Liabilities, Compute Amortization of Long-Term Liabilities Using the Effective-Interest Method, Prepare Journal Entries to Reflect the Life Cycle of Bonds, Appendix: Special Topics Related to Long-Term Liabilities, Explain the Process of Securing Equity Financing through the Issuance of Stock, Analyze and Record Transactions for the Issuance and Repurchase of Stock, Record Transactions and the Effects on Financial Statements for Cash Dividends, Property Dividends, Stock Dividends, and Stock Splits, Compare and Contrast Owners’ Equity versus Retained Earnings, Discuss the Applicability of Earnings per Share as a Method to Measure Performance, Describe the Advantages and Disadvantages of Organizing as a Partnership, Describe How a Partnership Is Created, Including the Associated Journal Entries, Compute and Allocate Partners’ Share of Income and Loss, Prepare Journal Entries to Record the Admission and Withdrawal of a Partner, Discuss and Record Entries for the Dissolution of a Partnership, Explain the Purpose of the Statement of Cash Flows, Differentiate between Operating, Investing, and Financing Activities, Prepare the Statement of Cash Flows Using the Indirect Method, Prepare the Completed Statement of Cash Flows Using the Indirect Method, Use Information from the Statement of Cash Flows to Prepare Ratios to Assess Liquidity and Solvency, Appendix: Prepare a Completed Statement of Cash Flows Using the Direct Method, https://openstax.org/books/principles-financial-accounting/pages/1-why-it-matters, https://openstax.org/books/principles-financial-accounting/pages/chapter-2, Creative Commons Attribution 4.0 International License.