Study sets matching "accounting2"
Study sets
Classes
Users
Accounting
Service business
Proprietorship
Asset
Planning, recording, and interpreting financial information
A business that performs an activity for a fee
A business owned by one person
Anything of value that is owned
Accounting
Planning, recording, and interpreting financial information
Service business
A business that performs an activity for a fee
Purchases Journal
Cash Payments Journal
Check
Purchases Discount
used to record purchases of inventory bought on account
used to record check payments
source document for a cash payment
discount given by a vendor for paying a bill early
Purchases Journal
used to record purchases of inventory bought on account
Cash Payments Journal
used to record check payments
Accounting
Accounting system
Accounting records
Financial statements
Planning, recording, analyzing and interpreting financial info…
A planned process for providing financial information that wil…
Organized summaries of a business's financial activities.
Financial reports that summarize the financial condition and o…
Accounting
Planning, recording, analyzing and interpreting financial info…
Accounting system
A planned process for providing financial information that wil…
Unique traits
Common stock
Preferred stock
Class A stock
Merchandising business, ownership through stocks, special jour…
Gives dividends and voting rights, with dividends and share va…
Payed back regardless, divided is constant, payed back first.…
Usually most votes, highest stock
Unique traits
Merchandising business, ownership through stocks, special jour…
Common stock
Gives dividends and voting rights, with dividends and share va…
Working Capital
Current Ratio
Acid-Test Ratio
Accounts Receivable Turnover
Current Assets - Current Liabilities... Expensive to keep large…
Current Assets/Current Liabilities... Declining or increasing ra…
Current Ratio less inventory and prepaid assets. More rigorous…
A measure of the liquidity of accounts receivable, computed by…
Working Capital
Current Assets - Current Liabilities... Expensive to keep large…
Current Ratio
Current Assets/Current Liabilities... Declining or increasing ra…
Account Number
Correcting Entry
File Maintenance
General Ledger
Number assigned to an account
A journal entry made to correct an error in a previous journal…
The procedure for arranging accounts in a general ledger, assi…
A ledger that contains all accounts needed to prepare financia…
Account Number
Number assigned to an account
Correcting Entry
A journal entry made to correct an error in a previous journal…
The responsibility center in which the…
This balance scorecard perspective meas…
This balance scorecards measures the pe…
Average invested assets formula
An Investment cener
Learning and growth
Customer perspective
Operating Income/ROI (residual income)
The responsibility center in which the…
An Investment cener
This balance scorecard perspective meas…
Learning and growth
Purpose of Accounting
Purpose of the Income Statement
Purpose of the Balance Sheet
Purpose of the Statement of Accounting…
To provide financial information that is useful for decision m…
To provide financial information about Income, Expenses and pr…
To provide financial information about assets, liabilities and…
To provide information on the nature of the business, the meas…
Purpose of Accounting
To provide financial information that is useful for decision m…
Purpose of the Income Statement
To provide financial information about Income, Expenses and pr…
Chart of accounts
Credit
Debit
Normal balance
An accounting device used to analyze transactions
An account recorded on the left side of a T account
An account recorded on the right side of a T account
The side of the account that is increased
Chart of accounts
An accounting device used to analyze transactions
Credit
An account recorded on the left side of a T account
What is the aim of cost accounting?
Fixed costs
Variable costs
Operating (Overhead) costs
Focuses on managing and overseeig costs rather than filing val…
Cost that does not change with an increase or decrease with am…
Cost that varies with production output; Raw materials increas…
Costs from day to day operations involving a company
What is the aim of cost accounting?
Focuses on managing and overseeig costs rather than filing val…
Fixed costs
Cost that does not change with an increase or decrease with am…
T - Account
Debit
Credit
Normal Balance
An accounting device used to analyze transactions.
An amount recorded on the left side of an account.
An amount recorded on the right side of an account.
The side of the account that is increased.
T - Account
An accounting device used to analyze transactions.
Debit
An amount recorded on the left side of an account.
purchases allowance
credit memorandum
board of directors
declaring a dividend
Credit allowed for part of the purchase price of merchandise t…
A form prepared by the vendor showing the amount deducted for…
A group of persons elected by the stockholders to govern a cor…
Action by a board of directors to distribute corporate earning…
purchases allowance
Credit allowed for part of the purchase price of merchandise t…
credit memorandum
A form prepared by the vendor showing the amount deducted for…
Out of Pocket Cost
Opportunity Cost
Variable Cost
Fixed Cost
involve an actual cash payment
the forgone benefit (or lost opportunity) of the path not take…
are those that change, in total, in direct proportion to chang…
are those that stay the same, in total, regardless of activity…
Out of Pocket Cost
involve an actual cash payment
Opportunity Cost
the forgone benefit (or lost opportunity) of the path not take…
accrued expenses
accrued revenues
prepaid expenses
unearned revenue
expenses incurred in the current accounting period but not yet…
revenue which have been earned but not yet received
this has been paid and recorded in the current accounting peri…
this has been received and recorded in the current accounting…
accrued expenses
expenses incurred in the current accounting period but not yet…
accrued revenues
revenue which have been earned but not yet received
FOB Destination
FOB Shipping Point
Machine Set Ups
Manufacturing Overhead
Legal title transfers to customer when goods are received.
Legal title transfers when goods leave the seller's place of b…
Adjustments made to machines in preparation for new production…
Manufacturing cost not directly associated with the production…
FOB Destination
Legal title transfers to customer when goods are received.
FOB Shipping Point
Legal title transfers when goods leave the seller's place of b…
Net Sales - Cost of Goods Sold
Gross Profit - Operating Expenses
Perpetual System
Periodic System
Gross Profit
Net Income (Loss)
Keeps track of inventories as they happen
Inventory not kept track of in the ledger, only recorded at th…
Net Sales - Cost of Goods Sold
Gross Profit
Gross Profit - Operating Expenses
Net Income (Loss)
Analysis of Liquidity
Working Capital =
Current Ratio =
Interpreting current ratio
- Of particular interest to bankers and other creditors... - Abil…
Current Assets - Current Liabilities
Current Assets / Current Liabilities
How many $ of current assets for every $ of current liabilities
Analysis of Liquidity
- Of particular interest to bankers and other creditors... - Abil…
Working Capital =
Current Assets - Current Liabilities
Analyzing and Posting Process
account
General Ledger
Some Asset Accounts
The accounting process identifies business transactions and ev…
record of increases and decreases in a specific asset, liabili…
is a record containing all accounts used by the company.
Land... Cash... Accounts Receivable... Supplies... Prepaid Accounts
Analyzing and Posting Process
The accounting process identifies business transactions and ev…
account
record of increases and decreases in a specific asset, liabili…
Comprehensive Income
Net income
OCI
Income Statements provide useful inform…
-Change in a company's equity during a period of time resultin…
Measure of financial performance resulting from the aggregatio…
Includes unrealized gains and losses on available for sale inv…
1. Evaluate past performance (the earnings)... 2. Predict future…
Comprehensive Income
-Change in a company's equity during a period of time resultin…
Net income
Measure of financial performance resulting from the aggregatio…