Financial Accounting with correct answers

Accounting - System that collects and processes (analyzes, measures, and records) financial information about an organization and reports that information to decision makers. Accounting entity - Is the organization for with financial data are to be collected. The four basic statements: - 1. Balance Sheet 2. Income Statement 3. Statement of Retained Earnings 4. Statement of Cash flows Balance Sheet - Reports the amount of assets, liabilities and stockholders' equity of an accounting entry at a point in time. Income Statement - Reports the revenues less the expenses of the accounting period. Statement of Retained Earnings - Reports the way that net income and the distribution of dividends affected the financial position of the company during the accounting period. Statement of Cash Flows - Reports inflows and outflows of cash during the accounting period in the categories of operating, investing, and financing. Basic Accounting Equation - Assets = Liabilities + Stockholders' Equity Assets - Are the economic resources owned by the company. Each of these economic resources is expected to provide future benefits to the firm. Liabilities - Are the company's debts or obligations. Which will be paid with assets or services. Stockholders' Equity (Owners' Equity) - Indicates the amount of financing provided by owners of the business and earnings. Is the sum of the contribute capital + the retained earnings. Accounting Period - Is the time period cover by the financial statements