FBLA Accounting I Vocabulary Questions and Answers Updated| 2024

FBLA Accounting I Vocabulary Questions and Answers Updated| 2024 Accountant Handles a broad range of responsibilities, makes business decisions, and prepares and interprets financial reports Accounting Clerk An entry-level job that can vary from specializing in one part of the system to doing a wide range of tasks For-profit businesses Operate to earn money for their owners Profit Money that is kept after all expenses of running a business have been deducted from the income Not-for-profit organizations Operate for purposes other than making a profit (nonprofit organizations) Public accounting firms Provide clients a variety of accounting services Audit The review of a company's accounting systems and financial statements to confirm that they follow generally accepted accounting principles Certified Public Accountant (CPA) An accountant who has met certain education and experience requirements and passed a national test Free enterprise system People are free to produce goods and services they choose and use their money as they wish Profit The amount of money earned over and above the amount spent to keep the business operating Loss When a business spends more money than they earn Entrepreneur A person who transforms ideas for products or services into real-world businesses Capital Money that investors, banks, or business owners supply Service Business Provides a needed service for a fee Merchandising Business Buys finished products and resells them to individuals or other businesses Manufacturing Businesses Buys raw materials, uses labor and machinery to transform them into finished products, and sells the finished products to individuals or other businesses Sole Proprietorship A business owned by one person Partnership A business is owned by two or more persons who agree to operate the business as co-owners Corporation A business recognized by law to have a life of its own; must get permission from the state to operate Charter Legal permission from the state that gives a corporation certain rights and privileges Shareholders The corporation's legal owners Accounting system Designed to collect, document, and report on financial transactions affecting the business Manual accounting system The accounting information is processed by hand