ACCT 2010 Chapters 1-3 (EXAM 1)
with Complete Solutions and Answers
CEO - ANS-chief executive officer
chief executive officer - ANS-president
CFO - ANS-Chief Financial Officer
Chief Financial Officer - ANS-vice president
COO - ANS-Chief Operating Officer
Chief Operating Officer - ANS-vice president of operations
BOD - ANS-Board of Directors
Board of Directors - ANS-oversight committee
FASB - ANS-Financial Accounting Standards Board
Securities and Exchange Commission - ANS-regulatory agency for public companies
SEC - ANS-Securities and Exchange Commission
Financial Accounting Standards Board - ANS-governing body that creates rules for
accounting
GAAP - ANS-Generally Accepted Accounting Principles
Generally Accepted Accounting Principles - ANS-created by the FASB - rules for
accounting
AICPA - ANS-American Institute of Certified Public Accountants
American Institute of Certified Public Accountants - ANS-organization that helps
educate the public about accounting
IASB - ANS-International Accounting Standards Board
, external transactions - ANS-exchanges of value between two entities, which cause
changes in the accounting equation
internal transactions - ANS-exchanges within an entity, which may or may not affect the
accounting equation
order of financial statements - ANS-1. income statement
2. statement of retained earnings
3. balance sheet
4. statement of cash flow
income statement - ANS-reports revenues and expenses and nets them to get the net
income or loss - shows how much you earned over the period
net income - ANS-when revenues exceed expenses
statement of retained earnings - ANS-accumulation of earnings retained from
operations in the business
start with beginning retained earnings + (net income or net loss (- for net loss instead of
+)) - dividends = ending retained earnings
net loss - ANS-when expenses exceed revenues
balance sheet - ANS-accountin equation (assets=liabilities+equity)
shows financial position of the organization
in equity: only put common stock and retained earnings - revenues and expenses are
already recorded in statement of retained earnings
statement of cash flow - ANS-shows cash inflows and outflows
return on assets - ANS-measures a company's abiliy to generate an adequate return on
its investment in assets (net income/average total assets)
prepaid expenses - ANS-assets from prepayments of future expenses (expenses
expected to be incurred in future accounting periods)
notes receivable - ANS-a promise to pay to us - there is interest charged and typically
has a defined due date
what is the cut off for a short-term asset to become a long-term asset - ANS-one year
with Complete Solutions and Answers
CEO - ANS-chief executive officer
chief executive officer - ANS-president
CFO - ANS-Chief Financial Officer
Chief Financial Officer - ANS-vice president
COO - ANS-Chief Operating Officer
Chief Operating Officer - ANS-vice president of operations
BOD - ANS-Board of Directors
Board of Directors - ANS-oversight committee
FASB - ANS-Financial Accounting Standards Board
Securities and Exchange Commission - ANS-regulatory agency for public companies
SEC - ANS-Securities and Exchange Commission
Financial Accounting Standards Board - ANS-governing body that creates rules for
accounting
GAAP - ANS-Generally Accepted Accounting Principles
Generally Accepted Accounting Principles - ANS-created by the FASB - rules for
accounting
AICPA - ANS-American Institute of Certified Public Accountants
American Institute of Certified Public Accountants - ANS-organization that helps
educate the public about accounting
IASB - ANS-International Accounting Standards Board
, external transactions - ANS-exchanges of value between two entities, which cause
changes in the accounting equation
internal transactions - ANS-exchanges within an entity, which may or may not affect the
accounting equation
order of financial statements - ANS-1. income statement
2. statement of retained earnings
3. balance sheet
4. statement of cash flow
income statement - ANS-reports revenues and expenses and nets them to get the net
income or loss - shows how much you earned over the period
net income - ANS-when revenues exceed expenses
statement of retained earnings - ANS-accumulation of earnings retained from
operations in the business
start with beginning retained earnings + (net income or net loss (- for net loss instead of
+)) - dividends = ending retained earnings
net loss - ANS-when expenses exceed revenues
balance sheet - ANS-accountin equation (assets=liabilities+equity)
shows financial position of the organization
in equity: only put common stock and retained earnings - revenues and expenses are
already recorded in statement of retained earnings
statement of cash flow - ANS-shows cash inflows and outflows
return on assets - ANS-measures a company's abiliy to generate an adequate return on
its investment in assets (net income/average total assets)
prepaid expenses - ANS-assets from prepayments of future expenses (expenses
expected to be incurred in future accounting periods)
notes receivable - ANS-a promise to pay to us - there is interest charged and typically
has a defined due date
what is the cut off for a short-term asset to become a long-term asset - ANS-one year
