Acct. 2301 ch 2
Terms
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- Transaction
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Any event that has a financial impact on the business and can be measured reliably.
- Account
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The record of the changes that have occurred in a particular asset, liability, or stockholders' equity during a period. The basic summary device of accounting.
- Cash
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Money and any medium of exchange that a bank accepts at face value.
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Prepaid expense
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A category of miscellaneous assets that typically expire or get used up in the near future. Examples include prepaid rent, prepaid insurance, and supplies.
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Accrued liability
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A liability for an expense that has not yet been paid by the company. Another name for accrued expense.
- Debit
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The left side of an account.
- Credit
- The right side of an account.
- Journal
- The chronological accounting record of an entity's transactions.
- Ledger
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The book of accounts and their balances.
- Posting
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copying amounts from the journal to the ledger.
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Trial balance
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A list of all the ledger accounts with their balances.
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Chart of accounts
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List of all a company's accounts and their account numbers.