1. Accounting equationation, e. The basic tool of accounting, stated as Assets = Liabilities + Equity, Asset, a. An economic resource that is expected to be of benefit in the future, Balance sheet (SOFP), i. Reports on an entity’s assets, liabilities, and stockholders’ equity as of a specific date, 4. Expense, f. Decreases in equity that occur in the course of selling goods or services, 5. Income statement, j. Reports on an entity’s revenues, expenses, and net income or loss for the period, 6. Liability, b. Debts that are owed to creditors, 7. Net income, d. Excess of total revenues over total expenses, 8. Net loss, c. Excess of total expenses over total revenues, Revenue, g. Increases in equity that occur in the course of selling goods or services, Statement of cash flows, h. Reports on a business’s cash receipts and cash payments during a period, Statement of retained earnings, k. Reports how the company’s retained earnings balance changed from the beginning to the end of the period.

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