Assets - answer✔Resources a business owns
Provide future service or benefits
Cash, Supplies, Equipment
Liabilities - answer✔Claims against assets (Debts and Obligations)
Creditors- Party to whom money is owed
Accounts Payable, Notes Payable
Stockholder's Equity - answer✔Ownership claim on total Assets
Referred to as residual Equity
Common Stock and Retained Earnings
Dividends - answer✔distribution of cash or other assets to stockholders. They reduce retained
earnings but are not an expense.
Expense - answer✔are the cost of assets consumed or services used in the process of earning
revenue.
Transactions - answer✔Economic events recorded by accountants
Income Statement - answer✔Reports Profitability of the company
List Revenues first, followed by expenses
Shows net income or net loss
Retained Earnings statement - answer✔Reports changes in retained earnings for same period as
income statement
Balance Sheet - answer✔Reports the assets, liabilities, and stockholders' equity at a specific date.
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