Accounting Study Guide 1 – Flashcards
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Account
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A record summarizing all the information pertaining to a single item in the accounting equation
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Account balance
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The amount in an account
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Account title
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The name given to an account
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Accounting
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Planning, recording, analyzing, and interpreting financial information
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Accounting equation
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An equation showing the relationship among assets, liabilities, and owner's equity
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Accounting records
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Organized summaries of a business's financial activities
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Accounting system
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A planned process for providing financial information that will be useful to management
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Asset
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Anything of value that is owned
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Business ethics
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The use of ethics in making business decisions
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Capital
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The account used to summarize the owner's equity in a business
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Equities
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Financial rights to the assets of a business
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Ethics
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The principles of right and wrong that guide an individual in making decisions
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Expense
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A decrease in owner's equity resulting from the operation of a business
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Financial statements
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Financial reports that summarize the financial condition and operations of a business
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Liability
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An ammount owed by a business
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Owner's equity
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The ammount remaining after the value of liabilities is subtracted from the value of all assets
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Proprietorship
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A business owned by one person
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Revenue
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An increase in owner's equity resulting from the operation of a business
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Sale on account
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A sale for which cash will be recieved at a later date
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Service business
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A business that performs an activity for a fee
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Transaction
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A business activity that changes assets, liabilities, or owner's equity
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Withdrawals
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Assets taken out of a business for the owner's personal use
