Accounting 1: Chapter 4

a balance sheet that contains a number of standard classifications or sections

entries made at the end of an accounting period to transfer the balances of temporary accounts to a permanent owner's equity account, Owner's Capital

entries to correct errors made in recording transactions

assets that a company expects to convert to cash or use up within one year

obligations that a company expects to pay from existing current assets within the coming year

a temporary account used in closing revenue and expense accounts

noncurrent assets that do not have physical substance

the ability of a company to pay obligations expected to be due within the next year

Generally, investments in stocks and bonds of other companies that companies normally hold for many years. Also includes long-term assets, such as land and buildings, not currently being used in operations.

obligations that a company expects to pay after one year

the average time that it takes to go from cash to cash in producing revenues

Accounts that relate to one or more accounting periods. Consist of all balance sheet accounts. Balance are carried forward to next accounting period

a list of permanent accounts and their balances after a company has journalized and posted closing entries

assets with relatively long useful lives, currently being used in operations

an entry, made at the beginning of the next accounting period, that is the exact opposite of the adjusting entry made in the previous period

The ownership claim of shareholders on total assets. It is to a corporation what owner's equity is to a proprietorship

Accounts that relate only to a given accounting period. Consist of all income statement accounts and owner's drawing account. All temporary acounts are closed at end of accounting period

a multiple-column form that may be used in making adjusting entries and in preparing financial statements