Test questions cap#1

Apuntes

-Recordkeeping You are required to keep records because it is mandated by law, for tax return preparation and planning, and to monitor your spending. -Check Register The check register lists all checks you have written. -Bank Reconciliation Balancing your bank account involves accounting for timing differences and verifying your calculations. -Overhead Expenses Overhead expenses are costs that cannot be assigned to any specific job. -Accruals Accruals in your books are expenses owed but not yet paid, or income earned but not yet received. -Ratios Ratios help control expenses from month to month. -Chart of Accounts The chart of accounts is a numerical list of the accounts in your general ledger. -Double-Entry Bookkeeping Double-entry bookkeeping requires twice the work of a single-entry system. -Balance Sheet Formula The correct formula for the balance sheet is Assets =Liabilities + Net Worth. -General Ledger The general ledger summarizes all transactions. -Business Equity Business equity appears on the financial statement called the Balance Sheet. -Income Statement Another name for the Income Statement is the Profit and Loss Statement. -Petty Cash System The petty cash system docum...