問題一覧
1
income received in advance
the earned revenue which is to be earned in the future but is already received in the current accounting period
2
revenue recognition
revenue is earned when goods have been delivered or services have been provided
3
state 2 reasons why customer might make returns
goods are expired or goods delivered are different from what were ordered
4
accounting entity theory
the activities of a business must be separate from the actions of the owner all transactions must be made from the pov of the business
5
expenses
cost incurred to earn income in the same accounting period
6
objectivity theory
accounting information recorded must be supported by reliable and verifiable evidence so that the financial statements will be free from opinions and biases
7
going concern
a business is divided into regular time intervals
8
FIFO METHOD
fifo method assumed that goods which are purchased first are sold first hence goods that are purchased last are assumed to remain in the business as the ending inventory
9
income receivable
income earned but not received yet
10
suggest a reason why business buys services on credit instead of paying cash
when business buys services on credit it is able to delay payment and use the cash to meet its immediate needs
11
accrual basis
business activities that have occured regardless of whether cash is paid or received should be recorded in the relevant accounting period
12
state the difference between a cash transaction and a credit transaction
payment is made at the same time or immediately during a cash transaction while payment is delayed or postponed during a credit transaction
13
historical cost
transactions should be recorded at their original cost
14
revnue
amounts earned from the main activities of a business
15
matching
expenses incurred must be matched against income earned in the same period to determine the profit for that period
16
suggest 2 ways to improve liquidity
increase sources of cash and manage cash outflow
17
income
amounts earned from the activities of the business
18
what are source documents
source documents are evidence that transactions have occured and details that can be recorded in a journal
19
prudence
the accounting treatment chosen should be the one that least overstates assets and profits and least understates liabilities and losses
20
accounting period
the life of a business is divided into regular time intervals
21
state the order in which financial statements are processed through the accounting system
source documents journal ledger trial balance financial statements
22
what is an accounting information
a system that a business collect store and process accounting data
23
suggest 2 ways to improve efficiency
sell inventory faster and keep sufficient inventory on hand
24
state the purpose of financial statements
financial statements shows the income earned and expenses incurred for a period of time and informs stakeholders about the profitability of a business
25
monetary
only business transactions that can be measured in monetary terms are recorded
26
consistency
once an accounting method is chosen this method should be used to all future accounting periods to enable meaningful comparison
27
state one reason why business would issue a credit note to customers
who were previously overcharged