Listed below are nine technical terms used in this chapter:Liquidity Nominal accounts Real accountsAdequate disclosure After-closing trial balance Closing entriesIncome summary Interim fi nancial statements DividendsEach of the following statements may (or may not) describe one of these technical terms. For eachstatement, indicate the accounting term described, or answer “None” if the statement does notdescribe any of the items.a. The accounting principle intended to assist users in interpreting financial statements.b. A term used to describe a company’s ability to pay its obligations as they come due.c. A term used in reference to accounts that are closed at year-end.d. A term used in reference to accounts that are not closed at year-end. e. A document prepared to assist management in detecting whether any errors occurred in post-ing the closing entries. f. A policy decision by a corporation to distribute a portion of its income to stockholders.g. The process by which the Retained Earnings account is updated at year-end. h. Entries made during the accounting period to correct errors in the original recording of com-plex transactions.
Listed below are nine technical terms used in this chapter:
Liquidity Nominal accounts Real accounts
Adequate disclosure After-closing
Income summary Interim fi nancial statements Dividends
Each of the following statements may (or may not) describe one of these technical terms. For each
statement, indicate the accounting term described, or answer “None” if the statement does not
describe any of the items.
a. The accounting principle intended to assist users in interpreting financial statements.
b. A term used to describe a company’s ability to pay its obligations as they come due.
c. A term used in reference to accounts that are closed at year-end.
d. A term used in reference to accounts that are not closed at year-end.
e. A document prepared to assist management in detecting whether any errors occurred in post-
ing the closing entries.
f. A policy decision by a corporation to distribute a portion of its income to stockholders.
g. The process by which the
h. Entries made during the accounting period to correct errors in the original recording of com-
plex transactions.
Trending now
This is a popular solution!
Step by step
Solved in 2 steps with 2 images
