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An accounting form that is used to record the increases and decreases in each financial statement item.
account receivable
A claim against the customer created by selling merchandise or services on credit.
The resources owned by a business.
balance of the account
The amount of the difference between the debits and the credits that have been entered into an account.
chart of accounts
A list of the accounts in the ledger.
Amounts entered on the right side of an account.
Amounts entered on the left side of an account.
Distributions to the owners (stockholders) of a corporation.
double-entry accounting system
A system of accounting for recording transactions, based on recording increases and decreases in accounts so that debits equal credits.
Assets used up or services consumed in the process of generating revenues.
The initial record in which the effects of a transaction are recorded.
journal entry
The form of recording a transaction in a journal.
The process of recording a transaction in the journal.
A group of accounts for a business.
The rights of creditors that represent debts of the business.
materiality concept
A concept of accounting that implies that an error may be treated in the easiest possible way.
The process of transferring the debits and credits from the journal entries to the accounts.
Increases in owner’s equity as a result of selling services or products to customers.
An error in which the entire number is moved one or more spaces to the right or the left, such as writing $542.00 as $54.20 or $5,420.00.
stockholders’ equity
stockholders’ equity
T account
The simplest form of an account.
An error in which the order of the digits is changed, such as writing $542 as $452 or $524.
trial balance
A summary listing of the titles and balances of accounts in the ledger.
two-column journal
An all-purpose journal.
unearned revenue
The liability created by receiving revenue in advance.
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