| A | B |
|---|
| adjusting entries | journal entries recorded to update general ledger accounts at the end of a fiscal period |
| permanent accounts | accounts used to accumulate information from one fiscal period to another |
| temporary accounts | accounts used to accumulate information until it is transferred to the owner's capital account |
| closing entries | journal entries used to prepare temporary accounts for a new fiscal period |
| post closing trial balance | a trial balance prepared after the closing entries are posted |
| component percentage | the relationship between an income statement item and a part of the statement that includes the item |
| worksheet | a columnar accounting form used to summarize the general ledger information needed to prepare the financial statements |
| fiscal period | the length of time for which a business summarizes and reports financial information |
| trial balance | a proof of equality of debits and credits in a general ledger |
| adjustments | changes recorded on a worksheet 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 |
| income statement | a financial statement showing the revenue and expenses for a fiscal period |
| net income | when sales are higher than expenses |
| net loss | when expenses are higher than income |
