Match the Items Below by Entering the Appropriate Code Letter

question 116

Short Answer

Match the items below by entering the appropriate code letter in the space provided.
A. Worksheet
B. Permanent accounts
C. Closing entries
D. Income Summary
E. Reversing entry
F. Capital Stock
G. Current assets
H. Operating cycle
I. Long-term liabilities
J. Correcting entries
1. Obligations that a company expects to pay after one year.
2. A part of owners' equity in a corporation.
3. An optional tool which facilitates the preparation of financial statements.
4. A temporary account used in the closing process.
5. Balance sheet accounts whose balances are carried forward to the next period.
6. The average time that it takes to go from cash to cash in producing revenues.
7. Entries to correct errors made in recording transactions.
8. The exact opposite of an adjusting entry made in a previous period.
9. Entries at the end of an accounting period to transfer the balances of temporary accounts to a permanent owner's equity account.
10. Assets that a company expects to pay or convert to cash or use up within one year.

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Definitions:

Period Cost

Expenses that are incurred in a specific accounting period but not directly tied to the production process, such as administrative and selling expenses.

Direct Cost

Expenses that can be directly traced to the production of specific goods or services, such as raw materials and labor.

Indirect Cost

Costs associated with operations that cannot be directly linked to a specific product, service, or project (e.g., utilities, rent, and managerial salaries).

Period Cost

Expenses not directly tied to the production of goods, thereby charged to the accounting period in which they occur.