ACC Chapter 3

How many steps are in the accounting cycle?

Step 1 in accounting cycle

Step 2 in accounting cycle

Step 3 in accounting cycle

step 4 in accounting cycle

step 5 in accounting cycle

step 6 in the accounting cycle

step 7 in the accounting cycle

step 8 in the accounting cycle

step 9 in the accounting cycle

What are the two types of accounting

In cash basis accounting, revenue is recognized when

In cash basis accounting, expenses are recognized when

In accrual accounting, revenue is recognized when

In accrual accounting, expenses are recognized when

Accounting principles underlying accrual accounting include

accounting info is reported at regular intervals

It is important to record accounting information in the correct...

calendar year is from

A fiscal year may end on a date other than

interim periods are

When to record revenue and what amount to record is what principle?

revenue is recorded when ________ and not necessarily when cash is ________

Revenue is earned when the good or serve has

the amount to record is known as

also known as the matching principle, is when expenses are the costs of assets used up, and of liabilities created in earning revenue

expenses need to be measured and ____________ (recorded) in the _____ ___________ in which related revenues are earned, not necessarily when cash is paid

occurs at the END of every accounting period

adjusting entries ensure that what principles are followed?

revenues are recorded in the period in which they are

expenses are recognized along with

adjusting entries are needed because

adjusting entries makes it possible to

adjusting the accounts always involve one what and one what?

April has been a particularly slow month for Barkley CPAs, and the business will have a net loss for the second quarter of the year. Barkley is considering not following its customary practice of reporting quarterly earnings to the public. Barkley CPAs is violating the ___________________________.

Barkley CPAs receives a utility bill for the December utilities for $500, ultimately paying the bill on January 5th. In what month should the utility expenses be recorded?

On December 1st, Barkley CPAs enters into a contract to provide accounting each
month, starting on December 15th. On January 15th, the client pays Barkley CPAs $10,000 for the first month of service (December 15 – January 15). Following GAAP, how much, if any, revenue should be recorded in December?

What are 2 categories of adjusting entries?

an adjustment for an item in which the business paid or received cash in advance

What are 3 types of deferral adjusting entries?

prepaid expenses is what type of account and are initially recorded as an

an expense paid in advance

In an adjusting entry, the amount of asset used/expired during the period must be

revenues paid in advance