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CHAPTER 1- summary - ASSETS What is an asset It is...

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ASSETS What is an asset? It is something a company owns which has future economic value. land building equipment goodwill LIABILITIES What is a liability? It is something a company owes. accounts payable notes payable taxes payable salaries payable OWNER’S EQUITY What is owner’s equity? It is what’s left of the assets after liabilities have been deducted. the same as net assets the owner’s claim on the entity’s assets REVENUES What are revenues? They are amounts received or to be received from customers for sales of products or services. sales performance of services rent interest EXPENSES What are expenses? They are amounts that have been paid or will be paid later for costs that have been incurred to earn revenue. salaries and wages utilities supplies used advertising ACCOUNTING FOR BUSINESS TRANSACTIONS What is a transaction? It is any event that both affects the financial position of the business and can be reliably recorded. PROBLEM: 1 Gay Gillen invests $30,000 to begin Gay Gillen eTravel. 2 Gillen purchases an office location, paying $20,000 in cash.
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