Review for Final Exam Fundamental Accounting Principles ch. 6-13
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17 terms
Terms | Definitions |
|---|---|
 FIFO | assigns the lowest amount of cost of goods sold. |
| LIFO | assigns the highest cost of goods sold. |
| Goods on consignment | goods shipped by the owner to another party who then sells them. |
| Promissory note | liability; note payable |
| Bad debts can be estimated with | an income statement focus (percent of sales) or with a balance sheet focus (percent of receivables or aging of receivables) |
| Straight-line depreciation | Cost - Salvage Value divided by Useful life in periods |
| Social Security Taxes | FICA |
| Contributing assets to join a partnership | I. Cash Debit i. T. Rasheed, Capital. Credit II. To record admission of Rasheed by investment |
| Liquidation of a partnership | I. Record the sale of noncash assets for cash and any gain or loss from their liquidation II. Allocate any gain or loss from liquidation of the assets in step 1 to the partners using their income-and-loss-sharing ration. III. Pay or settle all partner liabilities. IV. Distribute any remaining cash to partners based on their capital balance. |
| Preferred stock | more stable, doesn't offer same profit as common stock. Guarantees a regular dividend that isn't directly tied to the market. Tied to interest rate levels. |
| Common stock | can vote. Capital appreciation and dividends. |
| Statement of Retained earnings | Retained earnings + net income or - net loss - dividends |
| Statement of stockholders equity | lists the beginning and ending balances of key equity accounts and describes the changes that occur during the period. |
| Treasury stock | a corporation's reacquired shares. |
| Interest= | Principle x Rate x Time (360 days in a business year) |
| Accounts receivable Turnover= | Net Sale / Average accounts receivable |
| Straight Line Depreciation= | Cost of Asset - Salvage Value / Useful Life |
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