1. A balance sheet has 4 sections. They are:
Heading, Assets, Liabilities, and Owner’s Equity

2. The owner’s capital amount reported on a balance sheet is calculated as:
For a Net Income:
Beginning Capital + Net Income – Drawing
For a Net Loss:
Beginning Capital – Net Loss - Drawing

3. The formula for calculating net income is:
Total Revenue Minus Total Expenses

4. The net income calculated for the income statement and the net income on the work sheet must be
The Same

5. The _______ _______accounting concept is applied when financial statements contain all information necessary to understand a business’s financial condition.
Adequate Disclosure

6. The amount matches the Net Income/Net Loss on the Worksheet.
On an Income Statement, double lines are ruled across both amount columns to indicate ___?
The amount matches the Net Income/Net Loss on the Worksheet.

7. For a service business, the ______ reported on an Income Statement includes components for total expenses and net income.
Revenue

8. Total Expenses Divided by Total Sales
The formula for calculating the total expenses component percentage is ____?
Total Expenses Divided by Total Sales

9. The financial condition of a business refers to its financial ______.
Strength

10. The owner’s equity section of a balance sheet may report different kinds of details about _____ _____. Depending on the need of the business.
Owner’s Equity

11. Divide the amount of each component by the total amount of sales.
Component percentages on an Income Statement are calculated by ________________?
Divide the amount of each component by the total amount of sales.

12. A component percentage is the ______ relationship between one financial statement item and the total that includes that item.
Percentage

13. An Income Statement reports information over a period of time, indicating the financial progress of a business in earning a ______ or ______.
Net Income or Net Loss

14. The Matching Expense with Revenue accounting concept is applied when the _____ earned and the expenses incurred to earn that revenue are reported in the same fiscal period.
Revenue

15. Information needed to prepare an Income Statement comes from the _______ columns of a worksheet.

16. An amount written in parentheses on a financial statement indicates a/an ________.
Net Loss

17. A _____ _____ reports financial information for a specific date and includes the assets, liabilities, and owner’s equity.
Balance Sheet

18. When a business has two different sources of revenue, do you complete one or two Income Statements?

19. The date on a monthly Income Statement prepared on July 13 is written as `
For Month Ended July 13, 2011

20. The Net Income or Net Loss on the Worksheet.
The amount of Net Income calculated on the Income Statement should equal ______?
The Net Income or Net Loss on the Worksheet.

21. Accounting Period Cycle
Preparing financial statements at the end of each monthly fiscal period is an application of the accounting concept _____.
Accounting Period Cycle

22. Information needed to prepare an Income Statement’s Revenue section is obtained from a worksheet’s Income Statement _____ column.
Credit

23. A balance sheet reports a business’s financial condition on a _____ date.
Specific

24. Net Income divided by Total Sales.
The formula for calculating the net income component percentage is ________.
Net Income divided by Total Sales.

25. Balance Sheet Credit Column
Information needed to prepare the balance sheets liabilities section is obtained from a worksheet’s Balance Sheet ______ column.
Balance Sheet Credit Column

26. Assuring the financial statements contain all information necessary to understand a business’s financial condition is an application of the accounting concept ___________.
Adequate Disclosure

27. You will also have to prepare an Income Statement and Balance Sheet
You will also have to prepare an Income Statement and Balance Sheet. A partial worksheet will be provided. Remember, capital on balance sheet is not taken form worksheet—YOU MUST CALCULATE THE AMOUNT.