Chapter 4 Adjustments_Notes

Chapter 4 Adjustments_Notes - Chapter 4 Adjustments,...

Info iconThis preview shows pages 1–2. Sign up to view the full content.

View Full Document Right Arrow Icon
Chapter 4 – Adjustments, Financial Statements, and the Quality of Earnings Adjusting Revenues and Expenses Accounting cycle – process followed by entities to analyze and record transactions, adjust the records at the end of the period, prepare financial statements, and prepare the records for the next cycle A trial balance – list of all accounts with their balances to provide a check on the equality of the debits and credits During accounting period – transactions that resulting exchanges between company and external parties are analyzed and recorded in general journal in chronological order Revenues are recorded when earned (revenue principle) Expense are recorded when incurred to generate revenues during the same period (matching principle) Contra-account – an account that is an offset to, or reduction of, the primary account Net book value (book value, carrying value) - difference between its acquisition cost and accumulated depreciation, its related contra-account Adjusting entries – entries necessary at the end of the accounting period to measure all revenues and expenses of that period
Background image of page 1

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
Image of page 2
This is the end of the preview. Sign up to access the rest of the document.

This note was uploaded on 02/20/2009 for the course AEM 221 taught by Professor Little,j. during the Fall '08 term at Cornell.

Page1 / 2

Chapter 4 Adjustments_Notes - Chapter 4 Adjustments,...

This preview shows document pages 1 - 2. Sign up to view the full document.

View Full Document Right Arrow Icon
Ask a homework question - tutors are online