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30 terms

Accouting Test 2

STUDY
PLAY
internal control
set of policies and procedures designed to ensure proper accounting for transactions
signature card
verifies bankers signature, to open a checking account
deposit ticket
form showing a detailed listing of items being deposited
American Bankers Associations Number
ABA number, number that is the small fraction printed in the upper right-hand corner of each check
Magnetic Ink Character Recognition Code
MICR code, on lower left side of the front of each check
endorsement
stamping or writing depositors name
blank endorsement
deposit for simple signing the back of the check
restrictive enorsement
depositor adds words
check
a document ordering a bank to pay cash from a depositors account
drawer
the depositor who orders the bank to pay the cash
drawee
the bank on which the check is drawn
payee
the person being paid the cash
bank reconciliation
process of bringing the book and bank balances into agreement
deposits in transit
deposits that have not reached or been recorded by the bank before the statement is prepared
outstanding checks
checks issued that have not been presented to the bank for payment before the statement is prepared
service charges
bank charges for services such as check printing
collections
collections of promissory notes or charge accounts made by the bank on behalf of the depositor
Not Sufficient Funds Check
NSF, checks deposited by the depositor that are not paid because the drawer didn't have sufficient funds
Errors
errors made by the bank of the depositor in recording cash transactions
Employee
who works under the control and direction of an employer
independent contractor
performs a service for a fee and does not work under the control and direction of the company paying for the work
Fair Labor Standards Act
FLSA Act, requires employers to pay over time at 11/2 times the regular rate to any hourly employee working over 40 hours
withholding allowance
exempts a specific dollar amount of an employers gross pay from federal income tax withholding
Federal Insurance Contributions Act
FICA Act, requires employers to withhold taxes from employees earnings
self-employment income
net income of a trade or business run by an individual
self-employment tax
a contribution to the FICA program
Federal Unemployment Tax Act Tax
FUTA Tax, levied only on employers
State Unemployment Tax Tax
SUTA Tax, levied only on employers in most states
Merit-Rating System
encourages employers to provide regular employment to workers
Workers Compensation Insurance
provides insurance for employees who suffer a job-related illness of injury