Accumulated Depreciation is
a contra asset account
Depreciation expense for a period is the
portion of an assets cost that expired during the period
One year is either which? Fiscal? or Interim?
Fiscal year
Time period assumption
adjustments to companys accounts can only be made in the time period when the business terminates its operations
Monthly and quartely time periods are called
Interim periods
Usual ordering of accounts in general ledger is
Assets, Liabillities, Owners Capital, Owners Drawing, Revenues and Expenses
An accounting record of the balances of all assets is called…
General Ledger
recording of activity in the entire group of accounts maintained by company is also called
General Ledger
After transaction information has been recorded in the journal, it is then transferred to the ….
Ledger
a debit to an asset account indicates
an increase in the asset
Credits….
decrease assets and increase liabilltiies
Left side is…..
right side is….
Left Side Debit
right Side credit
if expenses are paid in cash, then
Assets will decrease
If services are rendered for credit, then
Owners equity will increase
Collection of a $1800 accounts receivable
Increases an asset, decrease an asset
Owners equity is often referred to as
Residual equity
Liabillities are ….
existing debts and obligations
Assets=
Liabillities+Owners Equity
Owners Equity is best depicted as
Assets- Liabillities
Common characteristic possesed by all assets is
Future economic benefit
Economic entity assumption requires that the activites
of an entity be kept seperate from the activities of its owner
GAAP stands for
Generall Accepted Accounting Principles
Historical cost principle requires that when assets are acquired they be recorded at
Cost
Generally accepting accounting principles are
standars that indicte how to report economic events
