Financial Accounting Final Exam (Ivy Tech) Questions with Verified Solutions

Financial Accounting Final Exam (Ivy Tech) Questions with Verified Solutions Revenues - answerGross increase in equity from a company's business activities that earn income; also called sales. Expenses - answerOutflows or using up of assets as part of operations of a business to generate sales. Accounts Receivable - answerAmounts to be received in the future due to the sale of goods or services Accounting Equation - answerAssets = Liabilities + Equity Income Statement - answerdescribes a company's revenues and expenses along with the resulting net income or loss over a period of time due to earnings activities Accounts on Income Statement - answerRevenues - Expenses Balance Sheet - answerFinancial statement that lists types and dollar amounts of assets, liabilities, and equity at a specific date. Accounts on balance sheet - answerassets, liabilities, equity Primary Objective of Financial Reporting - answerto provide information that is useful to investors and creditors for decision making Expanded Accounting Equation - answerAssets = Liabilities + Common Stock + Revenues - Expenses - Dividends FASB (Financial Accounting Standards Board) - answersets accounting standards (GAAP) in the U.S. T account - answerdebit left, credit right Normal Balance of Expenses - answerDebit (decrease equity) Normal balance of Revenues - answercredit Normal Balance of dividends - answerDr. (it decreases owner's equity) normal balance of assets - answerDebit Increases. Credit decreases. NB: Debit.