Essay About Accounting Principles And Assetschapter 2Account Types

Financial Accounting
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ECON 1900 EXAM 1 REVIEWThe following may be used as an outline to assist your review for Exam 1.  This review is neither exhaustive nor inclusive of everything you should learn from the first half of the course.CHAPTER 1Generally Accepted Accounting Principles (GAAP)Setting Account PrinciplesPrinciples of AccountingFoundation ConceptsTypes of Business EntitiesThe Accounting EquationFinancial StatementsIncome StatementStatement of Owner’s EquityBalance SheetStatement of Cash FlowsReturn on AssetsCHAPTER 2Account Types (Asset, Liability, Equity)Account Analysis Asset Accounts (Cash, A/R, Prepaid, etc)Liability Accounts (Accounts Payable, Notes Payable, etc)Equity Account (Owner’s Equity, Revenue, Expense, etc)Fundamentals of double-entry accountingDebits and CreditsJournal EntriesPosting to ledgerTrial Balance (Preparing, Using, Presenting)Debt RatioCHAPTER 3The Accounting PeriodAccrual vs. Cash Basis AccountingRevenue/ Expense RecognitionAdjusting Accounts/ Purpose of Adjusting EntriesPrepaid/Deferred ExpensesUnearned/Deferred RevenueAccrued ExpensesAccrued RevenueAdjusted Trial BalanceProfit MarginCHAPTER 4Temporary vs. Permanent AccountsClosing Entries (Recording, Posting)Post-closing trial balanceBalance SheetStructureCategoriesCurrent RatioCHAPTER 5MerchandiseReporting Merchandiser IncomeInventory Systems (Perpetual, Periodic)Purchases/ SalesDiscountsReturns and AllowancesTransportation CostsOwnership transfer‘Completing the Accounting Cycle’ for MerchandisersFinancial Statement FormatsMulti- vs. Single-Step Income StatementBalance SheetAcid Test and Gross Margin RatiosCHAPTER 6‘Inventory Basics’ & ‘Ownership’The Perpetual SystemSpecific Identification, LIFO, FIFO, Weighted AverageFinancial Statement EffectsInventory Valuation (Lower of Cost or Market)Inventory Estimation (Retail Method, Gross Profit Percentage Method)Inventory RatiosCHAPTER 7System PrinciplesControl, Relevance, Compatibility, Flexibility, Cost- BenefitSpecial Journals in AccountingSubsidiary LedgersSegment Return on AssetsCHAPTER 8Purposes and Principles of Internal ControlsCash ControlsBanking Activities as ControlsBank ReconciliationPetty Cash AccountsDays’ Sales UncollectedCHAPTER 9Accounts ReceivableRecognitionValuing A/RBad Debts- Write off vs. Allowance MethodEstimating Bad DebtsPercent of Sales MethodA/R MethodsNotes ReceivableDisposing of ReceivablesSelling to a factorCollateral for loanDiscount to bankAccounts Receivable Turnover