Exam (elaborations)
Bookkeeping Ch 1-6 Exam Questions and Answers
- Course
- Institution
Bookkeeping Ch 1-6 Exam Questions and Answers
[Show more]
Content preview
Bookkeeping Ch 1-6 Exam Questionsand Answers
Bookkeeping - Answer -the activity of recording business transactions
Double-entry bookkeeping - Answer -a system of recording and classifying business
transactions that maintains the balance of the accounting equation
General ledger - Answer -the ledger that contains all of the financial accounts of a
business
Cash receipts journal - Answer -a special journal used to record ONLY cash receipt
transactions
Cash disbursement journal - Answer -is a chronological listing of all payments
SOMETIMES CALLED A CHECK REGISTER AND IS SIMILAR TO THE RECORD
KEPT FOR A PERSONAL CHECKING ACCOUNT.
Bookkeeping - Answer -Bookkeeping, the methodical way in which business tracts their
transactions, is rooted in accounting.
-Accounting is the total structure of records and procedures used to record, classify, and
report information about a business's financial transactions.
- Bookkeeping involves the recording of the financial information into the accounting
system while maintaining adherence to solid accounting principles.
Balance sheet - Answer -Balance sheet: The financial statement that presents a
snapshot of the company's financial position (assets, liabilities, and equity) as of a
particular date in time. - It's called a balance sheet because the things owned by the
company (assets) must equal the claims against those assets (liabilities and equity)
Assets - Answer -All things a company owns in order to successfully run its business,
such as cash, buildings, land, tools, equipment, vehicles, and furniture.
Liabilities - Answer -All the debts the company owes, such as bonds, loans, and unpaid
bills.
Equity - Answer -All the money invested in the company by its owners. In a small
business owned by one person or a group of people, the owners' equity is shown in a
Capital account.
, Retained earnings - Answer -the accumulated earnings from a firm's profitable
operations that were reinvested in the business and not paid out to stockholders in
dividends
Drawing account - Answer -a temporary owner's equity account that is used when an
owner withdraws cash or other assets from the business for personal use.
Income statement - Answer -The financial statement that presents a summary of the
company's financial activity over a certain period of time, such a a month, quarter, or
year. The statement starts with Revenue earned, subtracts out the Cost of Goods Sold
(COGS) and the Expenses, and ends withe the bottom line - Net Profit or Loss.
Revenue - Answer -Revenue: All money collected in the process of selling hte
company's goods and services. Some companies also collect revenue through other
means, such as selling assets the business no longer needs or earning interest by
offering short-term loans to employees or other businesses.
Cost of Goods Sold - Answer -COGS: All money spent to purchase or make the
products or services the company plans to sell to its customers.
Expenses - Answer -Expenses: All money spent to operate the company that's not
directly related to the sale of individual goods or services.
Accounting period - Answer -a period that is typically one year; however, it can be any
length of time for which accounting records are maintained, often for a month.
Accounts Receivable: - Answer -Accounts Receivable: The account used to track all
customer sales that are made by store credit. Store credit refers not to credit card sales
but rather to sales in which the customer is given credit directly by the store and the
store needs to collect payment from the customer at a later date.
Accounts payable - Answer -Accounts payable: The account used to track all
outstanding bills from vendors, contractors, consultants, and any other companies or
individuals from whom the company buys goods and services.
Depreciation - Answer -The decline in dollar value of equipment and buildings which
have undergone obsolescence due to normal use over time.
General Ledger - Answer -the ledger that contains all of the financial accounts of a
business
Interest - Answer -...
Interest - Answer -Interest: The money a company needs to pay if it borrows money
from a bank or other company
The benefits of buying summaries with Stuvia:
Guaranteed quality through customer reviews
Stuvia customers have reviewed more than 700,000 summaries. This how you know that you are buying the best documents.
Quick and easy check-out
You can quickly pay through credit card or Stuvia-credit for the summaries. There is no membership needed.
Focus on what matters
Your fellow students write the study notes themselves, which is why the documents are always reliable and up-to-date. This ensures you quickly get to the core!
Frequently asked questions
What do I get when I buy this document?
You get a PDF, available immediately after your purchase. The purchased document is accessible anytime, anywhere and indefinitely through your profile.
Satisfaction guarantee: how does it work?
Our satisfaction guarantee ensures that you always find a study document that suits you well. You fill out a form, and our customer service team takes care of the rest.
Who am I buying these notes from?
Stuvia is a marketplace, so you are not buying this document from us, but from seller millyphilip. Stuvia facilitates payment to the seller.
Will I be stuck with a subscription?
No, you only buy these notes for $12.49. You're not tied to anything after your purchase.
Can Stuvia be trusted?
4.6 stars on Google & Trustpilot (+1000 reviews)
75057 documents were sold in the last 30 days
Founded in 2010, the go-to place to buy study notes for 14 years now