Accrual Accounting

Accrued Expense

Accrued Revenue

Accumulated Deprectiation

Adjusted Trial Balance

Adjusting Entry

Book Value (of a plant asset)

Cash Basis Accounting

Contra Account

Deferred Revenue

Depreciation

Matching principle

Plant Asset

Prepaid Expenses

Revenue Principle

Time-Period Concept

Unearned Revenue

A liability created when a business collects cash from customers in advance of doing work. Also called deferred revenue.

Accounting that records the impact of a business event as it occurs regardless of whether the transaction affected cash.

A liability created when a business collects cash from customers in advance of doing work. Also called unearned revenue.

The basis for recording revenues; tells accountants when to record revenue and the amount of revenue to record.

The asset’s cost minus accumulated depreciation.

Guide to accounting for expenses Guide to accounting for expenses. Identify all expenses incurred during the period, measure the expenses, and match them against the revenues earned during that same time period.

The allocation of a plant asset’s cost to expense over its useful life.

Ensures that information is reported at regular intervals.

Entry made at the end of the period to assign revenues to the period in which they are earned and expenses to the period in which they are incurred. Help measure the period’s income and bring the related asset and liability accounts to correct balances for the financial statements.

Accounting that records transactions only when cash is received or paid.

A revenue that has been earned but not yet collected in cash.

Advance payments of expenses Advance payments of expenses. Examples include prepaid rent, prepaid insurance, and supplies

The cumulative sum of all depreciation expense recorded for an asset.

An expense that the business has incurred but not yet paid.

An account that always has a companion account and whose normal balance is opposite that of the companion account.

Long-lived tangible assets—such as land, buildings, and equipment – used in the operation of a business.

A list of all the accounts with their adjusted balances.