| A | B |
|---|
| Accounting period | See fiscal period. |
| Accrual basis of accounting | Reporting income when earned and expenses when incurred. |
| Adjusted trial balance | A trial balance prepared after adjusting entries are posted. |
| Adjusting entries | Journal entries recorded to update general ledger accounts at the end of a fiscal period. |
| Adjustments | Changes recorded on a work sheet to update general ledger accounts at the end of a fiscal period. |
| Balance sheet | A financial statement that reports assets, liabilities, and owner’s equity on a specific date. |
| Cash basis of accounting | Reporting income when the cash is received and expenses when the cash is paid. |
| Certified public accountant (CPA) | An accountant who has passed the uniform certified public accounting exam and met the licensing requirement for a state. |
| Fiscal period | The length of time for which a business summarizes its financial information and reports its financial performance. |
| Fiscal year | A fiscal period consisting of 12 consecutive months. |
| Income statement | A financial statement showing the revenue and expenses for a fiscal period. |
| Net income | The difference between total revenue and total expenses when total revenue is greater. |
| Net loss | The difference between total revenue and total expenses when total expenses are greater. |
| Prepaid expense | Cash paid for an expense in one fiscal period that is not used until a later period. |
| Trial balance | A proof of the equality of debits and credits in a general ledger. |
| Work sheet | A columnar accounting form used to summarize the general ledger information needed to prepare financial statements. |
