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Vocabulary Ch 1-22
A record summarizing all the information pertaining to a single item in the accounting equation.
The amount in an account.
The number assigned to an account.
The name given to an account.
Planning, recording, analyzing, and interpreting financial information.
The series of accounting activities included in recording financial information for a fiscal period.
An equation showing the relationship among assets, liabilities, and owner's equity.
A period of time covered by an accounting report.
Organized summaries of a business's financial activities.
A planned process for providing financial information that will be useful to management.
Accounts Payable Ledger
A subsidiary ledger containing only accounts for vendors from whom items are purchased or bought on account.
Accounts Receivable Ledger
A subsidiary ledger containing only accounts for charge customers.
Expenses incurred in one fiscal period but not paid until a later fiscal period.
Accrued Interest Expense
Interest incurred but not yet paid.
Accrued Interest Income
Interest earned but not yet received.
Revenue earned in one fiscal period but not received until a later fiscal period.
The total amount of depreciation expense that has been recorded since the purchase of a plant asset.
Journal entries recorded to update general ledger accounts at the end of a fiscal period.
Changes recorded on a work sheet to update general ledger accounts at the end of a fiscal period.
Allowance Method of Recording Losses from Uncollectible Accounts
Crediting the estimated value of uncollectible accounts to a contra account.
The value of an asset determined by tax authorities for the purpose of calculating taxes.
Anything of value that is owned.
A financial statement that reports assets, liabilities, and owner's equity on a specific date.
A report of deposits, withdrawals, and bank balance sent to a depositor by a bank.
A report of credit card sales produced by a point-of-sale terminal.
The process of preparing a batch report of credit card sales from a point-of-sale terminal.
An endorsement consisting only of the endorser's signature.
Board of Directors
A group of people elected by the stockholders of a corporation to set the policies for the corporation.
The difference between an asset's account balance and its related contra account balance.
Book Value of a Plant Asset
The original cost of a plant asset minus accumulated depreciation.
Book Value of Accounts Receivable
The difference between the balance of Accounts Receivable and its contra account, Allowance for Uncollectible Accounts.
The use of ethics in making business decisions.
The account used to summarize the owner's equity in a business.
Total shares of ownership in a corporation.
A deduction from the invoice amount, allowed by a vendor to encourage early payment.
A petty cash on hand amount that is more than a recorded amount.
Cash Payments Journal
A special journal used to record only cash payment transactions.
Cash Receipts Journal
A special journal used to record only cash receipt transactions.
A sale in which cash is received for the total amount of the sale at the time of the transaction.
A petty cash on hand amount that is less than a recorded amount.
Chart of Accounts
A list of accounts used by a business.
A business form ordering a bank to pay cash from a bank account.
A bank account from which payments can be ordered by a depositor.
Journal entries used to prepare temporary accounts for a new fiscal period.
Code of Conduct
A statement that guides the ethical behavior of a company and its employees.
The percentage relationship between one financial statement item and the total that includes that item.
An account that reduces a related account on a financial statement.
An account in a general ledger that summarizes all accounts in a subsidiary ledger.
An organization with the legal rights of a person and which may be owned by many persons.
A journal entry made to correct an error in the ledger.
Cost of Merchandise
The price a business pays for goods it purchases to sell.
Cost of Merchandise Sold
The total original price of all merchandise sold during a fiscal period.
An amount recorded on the right side of a T account.
Credit Card Sale
A sale in which a credit card is used for the total amount of the sale at the time of the transaction.
A form prepared by the vendor showing the amount deducted for returns and allowances.
A person or organization to whom a liability is owed.
Cash and other assets expected to be exchanged for cash or consumed within a year.
Liabilities due within a short time, usually a year.
A ratio that shows the numeric relationship of current assets to current liabilities.
A person or business to whom merchandise or services are sold.
Date of a Note
The day a note is signed.
An amount recorded on the left side of a T account.
A bank card that automatically deducts the amount of a purchase from the checking account of the cardholder.
A form prepared by the customer showing the price deduction taken by the customer for returns and allowances.
Declaring a Dividend
Action by a board of directors to distribute corporate earnings to stockholders.
Declining-balance Method of Depreciaion
Multiplying the book value by a constant depreciation rate at the end of each fiscal period.
The portion of a plant asset's cost that is transferred to an expense account in each fiscal period during a plant asset's useful life.
A check that a bank refuses to pay.
A note that is not paid when due.
Earnings distributed to stockholders.
The recording of debit and credit parts of a transaction.
A written, signed, and dated order from one party ordering snother party, usually a bank, to pay money to a third party.
Earnings Per Share
The amount of net income after federal income tax belonging to a single share of stock.
Electronic Funds Transfer
A computerized cash payments system that transfers funds without the use of checks, currency, or other paper documents.
Employee Earnings Record
A business form used to record details affecting payments made to an employee.
A signature or stamp on the back of a check transferring ownership.
Information for each transaction recorded in a journal.
Financial rights to the assets of a business.
Estimated Salvage Value
The amount an owner expects to receive when a plant asset is removed from use.
The principles of right and wrong that guide an individual in making decisions.
A decrease in owner's equity resulting from the operation of a business.
Federal Unemployment Tax
A federal tax used for state and federal administrative expenses of the unemployment program.
The procedure for arranging accounts in a general ledger, assigning account numbers, and keeping records current.
A comparison between two items of financial information.
Financial reports that summarize the financial condition and operations of a business.
First-in, First-out Inventory Costing Method
Using the price of merchandise purchased first to calculate the cost of merchandise sold first.
The length of time for which a business summarizes and reports financial information.
Gain on Plant Assets
Revenue that results when a plant asset is sold for more than book value.
General Amount Column
A journal amount column that is not headed with an account title.
A ledger that contains all accounts needed to prepare financial statements.
Gross Profit Method of Estimating Inventory
Estimating inventory by using the previous year's percentage of gross profit on operations.
Gross Profit on Sales
The revenue remaining after cost of merchandise sold has been deducted.
A financial statement showing the revenue and expenses for a fiscal period.
Any product that is protected by patents, trademarks, and copyrights.
An amount paid for the use of money for a period of time.
The interest accrued on money borrowed.
The interest earned on money loaned.
Interest Rate of a Note
The percentage of the principal that is paid for use of the money.
A form used during a periodic inventory to record information about each item of merchandise on hand.
A form describing the goods or services sold, the quantity, and the price.
A form for recording transactions in chronological order.
Recording transactions in a journal.
Last-in, First-out Inventory Costing Method
Using the price of merchandise purchased last to calculate the cost of merchandise sold first.
A group of accounts
An amount owed by a business.
The retail price listed in a catalog or on an internet site.
Liabilities owed for more than a year.
The 12-month period that ends on June 30th of the prior year.
Loss on Plant Assets
The loss that results when a plant asset is sold for less than book value.
Maker of a Note
The person or business who signs a note and thus promises to make payment.
The amount added to the cost of merchandise to establish the selling price.
Maturity Date of a Note
The date a note is due.
The amount that is due on the maturity date of a note.
A federal tax paid for hospital insurance.
A form on which a brief message is written describing a transaction.
Goods that a merchandising business purchases to sell.
The amount of merchandise on hand for sale to customers.
A business that purchases goods and sells goods.
The difference between total revenue and total expenses when total revenue is greater.
The difference between total revenue and total expenses when total expenses is greater.
The total earnings paid to an employee after payroll taxes and other deductions.
Total sales less sales discount and sales returns and allowances.
The side of the account that is increased.
Promissory notes signed by a business and given to a creditor.
Promissory notes that a business accepts from customers.
Number of a Note
The number assigned to identify a specific note.
Opening an Account
Writing an account title and number on the heading of an account.
The amount remaining after the value of all liabilities is subtracted from the value of all assets.
A value assigned to a share of stock and printed on the stock certificate.
The period covered by a salary payment.
Payee of a Note
The person or business to whom the amount of a note is payable.
The total amount earned by all employees for a pay period.
A business form used to record payroll information.
Taxes based on the payroll of a business.
A merchandise inventory determined by counting, weighing, or measuring items of merchandise on hand.
Accounts used to accumulate information from one fiscal period to the next.
A merchandise inventory determined by keeping a continuous record of increases, decreases, and balance on hand.
All property not classified as real property.
An amount of cash kept on hand and used for making small payments.
Petty Cash Slip
A form showing proof of a petty cash payment.
Plant Asset Record
An accounting form on which a business records information about each plant asset.
Assets that will be used for a number of years in the operation of a business.
A computer used to collect, store, and report all the information of a sales transaction.
Post-closing Trial Balance
A trial balance prepared after the closing entries are posted.
A check with a future date on it.
Transferring information from a journal entry to a ledger account.
The relationship between the market value per share and earnings per share of a stock.
Principal of a Note
The original amount of a note; sometimes referred to as face amount of a note.
A written and signed promise to pay a sum of money at a specified time.
A business owned by one person.
Determining that the amount of cash agrees with the accounting records.
An invoice used as a source document for recording a purchase on account transaction.
Purchase on Account
A transaction in which the merchandise purchased is to be paid for later.
Credit allowed for part of the purchase price of merchandise that is not returned, resulting in a decrease in the customer's accounts payable.
A cash discount on purchases taken by a customer.
A special journal used to record only purchases of merchandise on account.
Credit allowed for the purchase price of returned merchandise, resulting in a decrease in the customer's accounts payable.
Land and anything attached to the land.
A business form giving written acknowledgement for cash received.
An endorsement restricting further transfer of a check's ownership.
Retail Merchandising Business
A merchandising business that sells to those who use or consume the goods.
An amount earned by a corporation and not yet distributed to stockholders.
An increase in owner's equity resulting from the operation of a business.
An entry made at the beginning of the next accounting period; the exact opposite of the adjusting entry made in the previous period.
The money paid for employee services.
Sale on Account
A sale for which cash will be received at a later date.
Credit allowed a customer for part of the sales price of merchandise that is not returned, resulting in a decrease in the vendor's accounts receivable.
A cash discount on sales taken by a customer.
An invoice used as a source document for recording a sale on account.
A special journal used to record only sales of merchandise on account.
Credit allowed a customer for the sale price of returned merchandise, resulting in a decrease in the vendor's accounts receivable.
A tax on a sale of merchandise or services.
Schedule of Accounts Payable
A listing of vendor accounts, account balances, and total amount due all vendors.
Schedule of Accounts Receivable
A listing of customer accounts, account balances, and total amount due from all customers.
A business that performs an activity for a fee.
Share of Stock
Each unit of ownership in a corporation.
Social Security Tax
A federal tax paid for old-age, survivors, and disability insurance.
A business paper from which information is obtained for a journal entry.
Special Account Column
A journal amount column headed with an account title.
An endorsement indicating a new owner of a check.
A journal used to record only one kind of transaction.
Any persons or groups who will be affected by an action.
State Unemployment Tax
A state tax used to pay benefits to unemployed workers.
Statement of Stockholder's Equity
A financial statement that shows changes in a corporation's ownership for a fiscal period.
A file of stock records for all merchandise on hand.
A form used to show the kind of merchandise, quantity received, quantity sold, and balance on hand.
An owner of one or more shares of a corporation.
Straight-line Method of Depreciation
Charging an equal amount of depreciation expense for a plant asset in each year of useful life.
A ledger that is summarized in a single general ledger account.
A report prepared to give details about an item on a principal financial statement.
An accounting device used to analyze transactions.
The maximum amount of earnings on which a tax is calculated.
Accounts used to accumulate information until it is transferred t o the owner's capital account.
The report that summarizes the cash and credit card sales of a point-of-sale terminal.
Terms of Sale
An agreement between a buyer and a seller about payment for merchandise.
Time of a Note
The days, months, or years from the date of signing until a note is to be paid.
The total pay due for a pay period before deductions.
A reduction in the list price granted to customers.
A business activity that changes assets, liabilities, or owner's equity.
A proof of the equality of debits and credits in a general ledger.
Accounts receivable that cannot be collected.
A business from which merchandise is purchased or supplies or other assets are bought.
Weighted-average Inventory Costing Method
Using the average cost of beginning inventory plus merchandise purchased during a fiscal period to calculate the cost of merchandise sold.
Wholesale Merchandising Business
A business that buys and resells merchandise to retail merchandising businesses.
Assets taken out of a business for the owner's personal use.
A deduction from total earnings for each person legally supported by a taxpayer, including the employee.
A columnar accounting form used to summarize the general ledger information needed to prepare financial statements.
The amount of total current assets less total current liabilities.
Writing off an Account
Canceling the balance of a customer account because the customer does not pay.