Accounting Terms Chapter 912

The budgeting process – 1) Budget reports are prepared, predicting what is likely to occur (Before the reporting period)
2) Actual Reports are prepared to detail what has happened in the current period (After Reporting Period)
3) Variance reports are prepared to highlight differences/problem areas
4) Decisions are made to improve business performance for the next period.
Asset, Balance Sheet, Debit, Permanent – Prepaid Rent
return on assets – net income/ avg. assets
Liquidity analysis – measures the ability of the firm to meet its current obligations.
Toy Emporium has a fiscal year that begins May 1. The company's third quarter consists of which months?
a. November, December, January
b. August, September, October
c. July, August, September
d. May, June, July – a. November, December, January
Quarterly – a threemonth period.
liability – an obligation of a business
Common commitment is the essence of a team, and what differentiates it from a group.
Merchandise (Retail) Business – -buys goods and resells them at a higher price for profit
-the added value is usually the convenience of the location or the variety of products offered
-ex. Sears, Walmart, and Home Depot
credit – Received payment for services on account: ________ accounts receivable
Work in process – That portion of manufactured inventory that has begun the production process buy is not yet complete.
Asset – Probable future economic benefit.
adjusting entries – Entries required at the end of an accounting period to record internal adjustments of various accounts due to the matching principle of accounting
Cоmmоn cоmmitment is the essence of а teаm, аnd what differentiates it from a group.
aging of accounts receivable – classifies all receivables by their due date
Current Liabilities – Debts that must be paid within a year
salary – the money paid for employee services

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