POB&F Unit 3 Review (3.01, 3.02)

The role of finance in business often involves:

Accounting Process: 2nd Step

Liabilities of a business and represent money owed to others.

Accounting Process: 5th step

The money or wealth needed to produce goods and services.

The process of obtaining funds and using them to achieve the goals of the business

Also known as stockholders’ (or shareholders’) equity, book value, and net worth.

To enter an amount on the right side of an account.

Management of a firm’s current balance of assets and liabilities

The process of keeping and interpreting financial records.

The direct costs attributable to the production of the goods sold in a company.

The methods and procedures used in consistently handling the business's financial information.

What a company owns

The value of the owner’s investment in the business.

An accounting device used to analyze transactions is called

What accounting record would summarize a business’s profit or loss for a previous year?

Assets of a business and represent money owed to a business by others.

A balance on the left side of an account in the general ledger.

Accounting Process: 1st Step

Ratio; refers to the # of days between a company’s paying for raw materials and receiving cash

How well a business generates cash flow in relation to the capital it has already invested

Accounting Process: 4th Step

Accounting Process: Final Step

Accounting Process: 3rd Step

What is one of the main reasons why businesses need to keep accurate accounting records?

Revenue – Expenses

Determine which projects a business will invest in, how the investment(s) will be financed, etc

Cardi studies financial reports.The government’s purpose in assigning this task to Cardi is to

The overall purpose of accounting is to

Expenses- Revenue

Captures the business’s financial condition at a particular moment; Assets= Liabilities+ OE

Which of the following is true?

Checks, receipts, invoices, and purchase orders are examples of

Sometimes called the profit-and-loss statement, shows how much money the business has made/lost