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Definition
| An organization stands apart from other organizations as a separate economic unit. (Including the Owner!) |
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| An Interaction of economic activity between two entities. |
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| Business record used as evidence that a transaction has occurred. |
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Definition
| Always use Dollars ($$) to record transactions, even when in another currency. |
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| Concept that a company records its transactions based on the dollars exchanged at the time the transaction occurred |
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Term
| The Company's economic resources are the Company's ______? |
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| The Company's debts are the Company's _____? |
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| The Owner's current investment is the ________? |
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Definition
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Term
| Contributions + Net Income - Withdrawals = ? |
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Definition
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Term
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Definition
| Time span for which a company reports its revenues and expenses. |
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Term
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Definition
| To determine its net income for an accounting period, a company computes and deducts the total expenses from the total revenues earned during the period. |
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Definition
| Recording revenues and related expense transactions in the same accounting period that goods or services are provided, REGARDLESS of when cash is received or paid. |
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Term
| Adjusting Entries. Examples? |
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Definition
| Journal entries that a company makes at the end of its accounting period to bring the company's revenue and expense account balances up-to-date and to show the correct ending balances in its asset and liability accounts. These always affect an [asset OR liability] AND an expense. (Example: Depreciation, Interest, Supplies used, expired rent, product sold now and delivered over several time periods) |
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| Dual Effect of Transactions |
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Definition
| A company must make at least two changes in its assets, liabilities, or owner's equity when it records each transaction. |
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Term
| A Balance sheet contains what three categories? |
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Definition
| Assets, Liabilities & Owners Equity |
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Term
| What is the accounting equation? |
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Definition
| Assets = Liabilities + Owner's Equity. |
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Term
| ______ = Owner's contributions + net income - owner's withdrawals. |
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Definition
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Term
| Revenue Records the _______ NOT the________. |
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Definition
| Revenue Records the activity NOT the cash collection. |
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Definition
| Transactions recorded when actual cash is received. |
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