Question

Match the items below by entering the appropriate code letter in the space provided.A twelve month accounting periodExpenses paid before they are incurredCost less accumulated depreciationDivides the economic life of a business into artificial time periodsA contra asset accountRecognition of revenue when the performance obligation is satisfiedRevenues recognized but not yet receivedExpenses incurred but not yet paidA cost allocation processAn optional tool which facilitates the preparation of financial statements.A temporary account used in the closing process.Balance sheet accounts whose balances are carried forward to the next period.Entries at the end of an accounting period to transfer the balances of temporary accounts to a permanent stockholders’ equity account.Entries to correct errors made in recording transactions.The exact opposite of an adjusting entry made in a previous period.A. Fiscal yearB. Income SummaryC. Revenue recognition principleD. Closing entriesE. Accrued expensesF. Accumulated depreciationG. Book valueH. Prepaid expensesI. WorksheetJ. Accrued revenuesK. Reversing entryL. DepreciationM. Time period assumptionN. Correcting entriesO. Permanent accounts

Answer 1

Answer:

A. Fiscal year: A twelve month accounting period.

H. Prepaid expenses: Expenses paid before they are incurred.

G. Book value: Cost less accumulated depreciation.

M. Time period assumption: Divides the economic life of a business into artificial time periods.

F. Accumulated depreciation: A contra asset account

C. Revenue recognition principle: Recognition of revenue when the performance obligation is satisfied.

J. Accrued revenues: Revenues recognized but not yet received.

E. Accrued expenses: Expenses incurred but not yet paid.

L. Depreciation: A cost allocation process.

I. Worksheet: An optional tool which facilitates the preparation of financial statements.

B. Income Summary: A temporary account used in the closing process.

O. Permanent accounts: Balance sheet accounts whose balances are carried forward to the next period.

D. Closing entries: Entries at the end of an accounting period to transfer the balances of temporary accounts to a permanent stockholders' equity account.

N. Correcting entries: Entries to correct errors made in recording transactions.

L. Reversing entry: The exact opposite of an adjusting entry made in a previous period.