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Chapter 02 - Analyzing Business Transactions
Chapter 02
Analyzing Business Transactions
1. The entire process of analyzing, recording, and reporting business transactions is based on
the fundamental accounting equation.
2. When using the fundamental accounting equation, an accountant must make sure that total
assets are always equal to total liabilities and owner's equity.
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© 2012 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in
any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part.
23. The property that a business owns is referred to as its ___________________.
24. The debts or obligations of a business are known as its ___________________.
25. The income statement shows revenue, ___________________, and net income or net loss
for a period of time.
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© 2012 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in
any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part.
38. The balance sheet shows
39. Amounts that a business must pay in the future are known as
40. Examples of assets are
