Intermediate Accounting Ch. 3

Intermediate accounti

16 cards   |   Total Attempts: 182
  

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Cards In This Set

Front Back
Basic Accounting Principle
Assets = Liabilities + Stockholders Equity
Trial Balance
1. Listing the account titles and their balances. 2. Toaling the debit and credit columns. 3. Proving the equaity of the two columns.
Adjusting Entries
(4 types)
Deferrals: 1. Prepaid Expenses 2. Unearned revenues
Accruals:
3. Accrued Revenues 4. Accrued Expenses
Prepaid Expenses
Expenses paid in cash and recorded as assets before they are used or consumed.
Unearned Revenues
Revenues received in cash and recorded as liabilities before they are earned.
Accrued Revenues
Revenues earned but not yet recieved
Accrued Expenses
Expenses incurred but not yet paid in cash or recorded.
Depreciation
An estimate rather than a factual measure ment of the expired cost. Oct. 31 Depreciation Expense 400 Accum. Depreciation- Equip. 400
Book Value
Cost- Depreciation
Unearned Revenue Adjusting Entry
Dr. Liability Account Cr. Revenue Account
Accrued Revenue Adjusting Entry
Dr. Accounts Recivable Cr. Revenue
Computing Interest
Face Value Annual Interest Time in terms of Note X Rate X of one year.
Accrued Expense Adjusting Entry
Dr. Expense Cr. Payable
Bad Debts
Dr. Bad Debt Expense Cr. Allowance for Doubtful Accounts
Closing Entries (4)
1. Revenue > Income Summary
2. Income Summary < Expenses 3. Income Summary > Retained Earnings 4. Retained Earnings < Dividends