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Match the Following Terms with Definitions

Question 259

Matching

Match the following terms with definitions.

Premises:

Responses:

Monetary unit principle

The relation between a company's assets, liabilities, and equity.

Accounting equation

The principle that assumes transactions and events can be expressed in money units.

Events

Creditor's claims on assets.

Business entity principle

The principle that revenue is recorded when earned through providing goods or services.

Expenses

Describes a company's revenues and expenses along with the resulting net income or loss over a period of time.

Revenue recognition principle

A financial statement that lists cash inflows (receipts) and cash outflows (payments); the cash flows are arranged by operating, investing, and financing activities.

Liabilities

The principle that requires a business to be accounted for separately from its owners.

Income statement

Happenings, such as changes in market value, that effect the accounting equation and are reliably measured.

Statement of cash flows

Wages paid to earn revenues.

Premises:

Monetary unit principle

Accounting equation

Events

Business entity principle

Expenses

Revenue recognition principle

Liabilities

Income statement

Statement of cash flows

Responses:

The relation between a company's assets, liabilities, and equity.

The principle that assumes transactions and events can be expressed in money units.

Creditor's claims on assets.

The principle that revenue is recorded when earned through providing goods or services.

Describes a company's revenues and expenses along with the resulting net income or loss over a period of time.

A financial statement that lists cash inflows (receipts) and cash outflows (payments); the cash flows are arranged by operating, investing, and financing activities.

The principle that requires a business to be accounted for separately from its owners.

Happenings, such as changes in market value, that effect the accounting equation and are reliably measured.

Wages paid to earn revenues.

Correct Answer:

Premises:

Responses:

Monetary unit principle

Accounting equation

Events

Business entity principle

Expenses

Revenue recognition principle