ECON231 Study Guide - Midterm Guide: Subledger, Perpetual Inventory, Revenue Recognition

• School: University of Waterloo
• Department: Economics
• Course: ECON231
• Professor: Vivian Yang

Document Summary

Creditors: lends money to businesses to start up/expand. Investors: individuals who buy small percentages of large corporations. Accounting: a system that collects and processes financial information about an organization and reports that information to decision makers. Managerial accounting: developing accounting information for internal decision makers. Statement of financial position (balance sheet): reports the financial position of an accounting entity at a particular point in time. Accounting entity: the organization for which financial data is to be collected. Assets: economic resources controlled by the entity as a result of past business events. Lia(cid:271)ilities: the e(cid:374)tit(cid:455)"s o(cid:271)ligatio(cid:374)s that (cid:396)esult f(cid:396)o(cid:373) past (cid:271)usi(cid:374)ess events. Ha(cid:396)eholde(cid:396)s" e(cid:395)uit(cid:455): the a(cid:373)ou(cid:374)t of fi(cid:374)a(cid:374)(cid:272)i(cid:374)g p(cid:396)o(cid:448)ided (cid:271)(cid:455) o(cid:449)(cid:374)e(cid:396)s of the (cid:271)usi(cid:374)ess, as well as earnings over time. Ha(cid:396)eholde(cid:396)s" e(cid:395)uit(cid:455) a(cid:396)ises f(cid:396)o(cid:373) (cid:272)ontributed capital, retained earnings, other components (reflect changes in the values of specific assets and liabilities over time)