Trust Accounts Used for Holding Small Amounts of Client Funds

question 48

Short Answer

Trust accounts used for holding small amounts of client funds or that will be held for too short a period of time to generate income sufficient to allocate to the client is referred to as ____________________ accounts.

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Definitions:

Owner's Capital

The equity in a firm attributable to the owner, reflecting the amount invested by and the earnings retained for the business owner.

Accounts Receivable

Monies owed to a company by customers for sales made on credit that are recorded as assets on the balance sheet.

General Journal

A foundational accounting record that keeps chronological entries of a company's transactions.

T-Accounts

A visual representation used in accounting to depict the debits and credits for each financial transaction affecting a particular account.