Match the Terminology with the Description by Entering the Proper

question 92

Essay

Match the terminology with the description by entering the proper letter in the space to the left. A. Credits
B. Share Capital
C. Cost principle
D. Transaction
E. Debits
F. Liability
G. Statement of financial position
H. Primary objective of external financial reporting
I. Separate-entity assumption
J. Retained earnings
K. As at December 31, 20X1
L. For the period ended December 31, 20X1
M. None of the above is correct ____
1. Increase assets and decreases shareholders'' equity. ____
2. An exchange between an entity and another party. ____
3. Normal balances for liabilities. ____
4. To provide useful economic information about a business to help external parties mak e sound financial decisions. ____
5. Accounting assumption that requires assets to be recorded at their cash equivalent cost. ____
6. Cumulative earnings that have not been distributed to the owners. ____
7. A debt owed by the entity. ____
8. Statement of financial position. ____
9. Account for a business separate from its owners. ___
10. Dating of the statement of financial position (20X1).

---

Definitions:

Straight-line Method

A method of accounting for depreciation that allocates an asset's cost evenly over its useful life.

Called Bonds

Bonds that an issuer redeems before their maturity date at a specified call price.

Callable Bonds

Bonds that can be redeemed (called) by the issuer prior to their maturity date, typically at a premium above their par value.

Interest Payable

The amount of interest expense that has been incurred but not yet paid by a company, typically related to loans or credit.