Going Concern when financial statements are prepared with the expectation that a business will remain in operation forever Adequate Discloser when financial statements contain all information necessary to understand a business's financial condition Stakeholders persons or groups who will be affected by an action in a business Income statement heading, revenue, expenses, and net income/loss- indicates financial progress of a business in earning a net income or net loss (get info from worksheets income statement columns Matching expenses revenue earned and expenses incurred that go with that revenue are reported in the same fiscal period

1. Going Concern

when financial statements are prepared with the expectation that a business will remain in operation forever

2. Adequate Discloser

when financial statements contain all information necessary to understand a business's financial condition

3. Stakeholders

persons or groups who will be affected by an action in a business

4. Income statement

heading, revenue, expenses, and net income/loss- indicates financial progress of a business in earning a net income or net loss (get info from worksheets income statement columns

5. Matching expenses

revenue earned and expenses incurred that go with that revenue are reported in the same fiscal period.

6. Component Percentage

percentage relationship between one financial statement item and the total that includes that item.

7. total expenses component percentage

total expenses divided by total sales

8. Net income component percentage

net income divided by total sales

9. Accounting equation

assets=liabilities+capital

10. Equities

liabilities and owner's equity

11. Balance sheet

reports financial information on a specific date-indicating the financial condition of a business-get info from worksheets balance sheet columns (except capital)

12. Balance sheet has 4 sections

heading, asserts, liabilities and owner's equity-assets on left-liability and owners equity or right side

13. Capital equation

capital acct balance + net income or - net loss- drawing=current capital (this # goes on the balance sheet)