WGU D103 Intermediate Accounting I Unit 2-4

WGU D103 Intermediate Accounting I Unit 2-4 Leave the first rating Students also studied Terms in this set (174) Western Governors UniversityD 103 Save D217 Accounting Information Syste...226 terms vanessa_harris263 Preview

WGU - C722

281 terms LearningChuPreview D103 Intermediate Accounting 326 terms emulywud0616 Preview WGU D 135 term Mic APB OpinionsThe APB's official pronouncements issued from 1959 through 1973 which were intended to be based mainly on research studies and be supported by reasons and analysis.Accounting Principles Board (APB)An accounting rule-making board which provided official pronouncements, called APB Opinions, from 1959 through 1973.Accounting Research BulletinsPronouncements issued by CAP dealing with a variety of timely accounting problems during the years 1939 to 1959.Accrued ExpensesExpenses incurred but not yet paid.Accrued RevenuesRevenues for which the performance obligation has been satisfied, but for which cash has not yet been received.Adjusted Trial BalanceA trial balance prepared immediately after all adjustments have been posted.Adjusting EntriesEntries made at the end of an accounting period to bring all accounts up to date on an accrual accounting basis.American Institute of Certified Public Accountants

(AICPA)

The national professional organization of practicing Certified Public Accountants.Book ValueThe difference between the cost of an asset and its related accumulated depreciation.Closing ProcessThe formal process by which all nominal accounts are reduced to zero to prepare the accounts for the next period's transactions.

Committee On Accounting Procedure (CAP)An organization composed of practicing CPAs which issued Accounting Research Bulletins dealing with a variety of accounting problems during the years 1939 to 1959.ComparabilityAbility to compare accounting information of different companies because they measure and report information in a similar manner.CompletenessAll information necessary for faithful representation is provided.Conceptual FrameworkA coherent system of interrelated objectives and fundamentals that can lead to consistent standards.Confirmatory ValueInformation that confirms or corrects prior expectations.ConsistencyAn entity applies the same accounting treatment to similar events from period to period.Contra Asset AccountAn account that offsets an asset account on the balance sheet.Cost ConstraintThe constraint that states that information should be provided only if the benefits of providing such information outweigh the costs of providing it.Cost-benefit RelationshipThe costs of something weighed against the benefits that can be derived.Current AssetsCash and other assets expected to be converted into cash, sold, or consumed either in one year or in the operating cycle, whichever is longer.Current LiabilitiesObligations that are reasonably expected to be liquidated either through the use of current assets or the creation of other current liabilities within the longer of 1 year or the operating cycle.Current Operating Performance ApproachA concept that states that the net income figure should show only the regular, recurring earnings of the business.DepreciationThe process of allocating the cost of an asset to expense over its useful life in a rational and systematic manner.Discontinued OperationThe disposal of a component of a business or the elimination of a component that represents a strategic shift.Earnings ManagementThe planned timing of revenues, expenses, gains, and losses.Earnings Per ShareThe net income earned by each share of outstanding common stock.Economic Entity AssumptionAn assumption that states economic activity can be identified with a particular unit of accountability.Expense Recognition PrincipleThe recognition of expenses is related to revenues; "Let the expense follow the revenue."

Fair ValueDefined as "the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date." Fair Value PrincipleDefined as "the amount for which an asset could be exchanged, a liability settled, or an equity instrument granted could be exchanged, between knowledgeable, willing parties in an arm's length transaction." Faithful RepresentationThe numbers and descriptions represent what really existed or happened.Financial Accounting Standards Board (FASB)A seven member board created in 1973, which currently establishes and improves standards of financial accounting and reporting for the guidance and education of the public.Financial Accounting Standards Board Accounting Standards Codification Created by the FASB and provides in one place all the authoritative literature to a particular topic of GAAP.Financial Accounting Standards Board Codification Research System (CRS) An online, real-time database that provides easy access to the Codification Financial FlexibilityThe ability of an enterprise to take effective actions to alter the amounts and timing of cash flows so it can respond to unexpected needs and opportunities.Financial StatementsIncludes the balance sheet, income statement, statement of cash flows, and statement of stockholders' equity.Financing ActivitiesActivities that include liability and owners' equity items.Full Disclosure PrincipleThe principle that information should be provided if it is of sufficient importance to influence the judgment and decisions of an informed user.Going Concern AssumptionAn assumption that states an enterprise will continue in operation long enough to carry out its existing objectives and commitments.Historical Cost PrincipleAn accounting principle that states that assets and liabilities should be recorded at their acquisition price.Income StatementThe financial statement which measures the results of operations during the period.Intangible AssetsAssets that do not have physical substance and are not financial instruments, such as patents, copyrights, franchises, goodwill, trademarks, trade names, and customer lists.InterpretationsPronouncements issued by the FASB, which represent modifications or extensions of existing standards.Intraperiod Tax AllocationThe procedure of associating income taxes with the specific item that directly affects the income taxes for the period.

Investing ActivitiesActivities that include making and collecting loans and acquiring and disposing of investments (both debt and equity) and property, plant, and equipment.LiquidityThe amount of time that is expected to elapse until an asset is realized or otherwise converted into cash or until a liability has to be paid.Long-term LiabilitiesObligations that are not reasonably expected to be liquidated within a year or the normal operating cycle, whichever is longer, but instead, are payable at some date beyond that time.MaterialityThe constraint of determining if an item is important enough to likely influence the decision of a reasonably prudent investor or creditor.Modified All-inclusive ConceptA concept that states that companies record most items, including unusual or infrequent ones, as part of net income Monetary Unit AssumptionAn assumption stating that money is the common denominator of economic activity and provides an appropriate basis for accounting measurement and analysis.Multiple-step Income StatementAn income statement that shows numerous steps in determining net income (or net loss), including operating and nonoperating sections.NeutralityInformation is unbiased and cannot be selected to favor one set of parties over another.Noncontrolling InterestThe portion of equity (net assets) interest in a subsidiary not attributable to the parent company.Notes to Financial StatementsFurther explain the items presented in the main body of the statements.Operating ActivitiesActivities that involve the cash effects of transactions that enter into the determination of net income.Periodicity AssumptionAn assumption stating that the economic activities of an enterprise can be divided into artificial time periods.Predictive ValueInformation that helps users make predictions about the ultimate outcome of past, present, and future events.Prepaid ExpensesAn item paid and recorded in advance of its use or consumption, part of it properly represents expense of the current period and part represents an asset on hand at the end of the period.Property, Plant, and EquipmentTangible long-lived assets used in the regular operations of the business, such as land, buildings, machinery, furniture, tools, and wasting resources.Qualitative CharacteristicsCharacteristics that make accounting information useful RelevanceInformation capable of making a difference in a decision.