Accounting 2361 TxState Final Proschko with correct answers 2024

(CH 1)GAAP correct answers (Generally Accepted Accounting Principles) Common set of standards that the accounting profession has developed and generally accepted and universally practiced. SEC correct answers (Securities and Exchange Commission) The agency of the U.S. government that oversees U.S. financial markets and accounting standard-setting bodies. FASB correct answers (Financial Accounting Standards Board) The primary accounting standard-setting body in the United States. Cost Principle correct answers Dictates that companies record assets at their cost. This information can be verified by documentation and is therefore reliable. Monetary Unit correct answers An assumption that requires companies to include in the accounting records only transaction data that can be expressed in terms of money. This enables accounting to quantify (measure) economic events and is vital to applying the cost principle. Economic Entity correct answers Any organization or unit in society. It may be a company, a governmental unit, a municipality, a school district or a church. Economic Entity Assumption correct answers Requires activities of an entity be kept separate and distinct from the activities of its owner and all other economic entities. Assets correct answers the resources a business owns. The business uses its assets in carrying out such activities as production and sales. Assets typically have capacity to provide future services or benefits which can result in cash inflows. Liabilities correct answers Claims against assets - That is existing debts and obligations. Accounts Payable, Note Payable, Wages Payable, Sales and Real Estate Taxes Payable and Unearned Revenue are a few examples. Stockholders' Equity correct answers The ownership claim on total assets. Equal to total assets minus total liabilities. The SHE section of a corporation's balance sheet consists of (1) paid-in capital and (2) retained earnings. Revenues correct answers Gross increases in stockholders' equity resulting from business activities entered into for the purpose of earning income. Generally, revenues result from selling merchandise, performing services, renting property and lending money.