Powerpoint 3 Flashcards

1
Q

Free Cash Flow

A

Cash provided by operations - capital expenditures - cash dividends

A measure of solvency

The greater the better

could be liquidity too..

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2
Q

Normal Dr. Balance

A

Cash

Inventory

Accounts receivable

Utilities expense

Prepaid Rent

Equipment

Dividends

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3
Q

Normal Cr. Balance

A

Accounts payable

Common Stock

Notes payable

Retained earings

Sales revenue

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4
Q

Debits and Credits are synonymous to:

A

Left and Right

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5
Q

If an individual asset account is increased, which of the following corresponding effects would be possible:

A

Increase in a specific liability

Decrease in another asset

Increase in stockholders’ equity

All of the above are possible

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6
Q

Accounting Information System

A

A system of collecting and processing transaction data and communicating financial information to decision makers

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7
Q

Accounting Transactions

A

The economic events that require recording in the financial statements

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8
Q

Account

A

An individual accounting record of increase and decrease in a specific asset, liability, stockholders equity, revenue, or expense item

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9
Q

Debit

A

The left side of an account

Dr.

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10
Q

Credit

A

The right side of an account

Cr.

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11
Q

Normal Balance

A

The side of the T-Account that leads to an INCREASE

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12
Q

DEAD

A

Debit increased:

Expenses

Assets

Dividends

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13
Q

CuRLS

A

Credit normal balance - credit increased

Revenues

Liabilities

Stockholders’ equity

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14
Q

Ledger

A

The entire group of accounts maintained by a company

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15
Q

Chart of accounts

A

The list of accounts that a company uses

It is important to note that the number and type of accounts used differ from company to company - depends on size, complexity, industry, type of business

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16
Q

The Trial Balance

A

Lists all accounts and their balances at a given time (typically end of accounting period)

Proves that all of the accounts balance in the accounting equation after posting is completed

17
Q

___________ is useful in creating the financial statements

A

The trial balance

18
Q

In the ______ the accounts are listed in order of liquidity

A

trial balance

19
Q

the ________ is helpful in identifying posting errors and is a complete listing of all T-accounts

A

trial balance