Review of Module 2 - Accounting Basics

2. Telling the results of the financial information.
5. Designs the accounting information system and focuses on analyzing and interpreting information.
8. Generally supervises the work of accounting clerks, helps with daily accounting work, and summarizes accounting information.
9. Looking at events that have taken place and thinking about how they affect the business.
12. A type of ownership structure in which one person owns the business.
15. The accountant who oversees the entire accounting process and is the principal accounting officer of a company.
16. A system of gathering financial information about a business and reporting this information to users.
18. An item that is owned by a business and will provide future benefits.
21. Withdrawals that reduce owner’s equity as a result of the owner taking cash or other assets out of the business for personal use.
22. Bringing the various items of information together to determine a result.
23. The decrease in assets (or increase in liabilities) as a result of efforts to produce revenues.
25. Reviewing and testing to be certain that proper accounting policies and practices have been followed.

1. A measure of the ease with which an asset will be converted to cash.
3. A separate record used to summarize changes in each asset, liability, and owner’s equity of a business.
4. A type of ownership structure in which stockholders own the business. The owners’ risk is usually limited to their initial investment, and they usually have very little influence on the business decisions.
6. Sorting and grouping similar items together rather than merely keeping a simple, diary-like record of numerous events.
7. Services focused on tax planning, preparing tax returns, and dealing with the Internal Revenue Service and other governmental agencies.
10. Something owed to another business entity.
11. Reduce owner’s equity as a result of the owner taking cash or other assets out of the business for personal use.
12. A type of ownership structure in which more than one person owns the business.
13. Business transactions provide the necessary input for the accounting information system.
14. Entering financial information about events affecting the company into the accounting system.
17. The amount a business charges customers for products sold or services performed.
19. The process in which accountants help managers develop a financial plan.
20. Recognizing the effect of transactions on the assets, liabilities, owner’s equity, revenues, and expenses of a business.
24. The financial statements are the output of the accounting information system.