Accounting Chapter 4 Vocabulary

net loss – Excess of total expenses over total revenues.
beginning work-in-process – consists of work done on partially
completed units that represents prior-period work with the
costs assigned to them being prior-period costs. Uses two approaches
for dealing with the prior-period output and costs found in BWIP:
the weighted average method and the FIFOmethod.
Trial Balance – A statement to test the accuracy of total debits and credits after the transactions have been recorded.
Capital – Financial investment in a business; equity.
income summary – a temporary account used in closing revenue and expense accounts
"Operating Profit Margin" Classify, Calculate, and Interpret – Operating Profitability Ratio

= [ Operating Income(EBIT) / Revenue ]

Too low, operating expenses too high. Operating efficiency is low (Operating expenses). Could add back "Depreciation and Amortization" more conservative

salaries payable – current liabilities
Paying attention to the feedback is important because of its dynamic nature while progressing through the steps in the control process.
service business – A business providing services rather than products to customers.
Contingent Liability – Is a potential liability that has arisen as the result of a past event.
Turnover – Sales / Average operating assets
2nd step of Accounting Cycle – record transactions in general journal
recording closing entries – transfer the end of the period balances in revenue, expense, and dividends accounts to the permanent retained earning account
Debt contract – A contract between a lender and borrower
short term liabilities – éven belüli kötelezettségek
Pаying аttentiоn tо the feedbаck is impоrtant because of its dynamic nature while progressing through the steps in the control process.
Which basic element of financial statements arises from peripheral or incidental transactions? – Gains
hidden extras – versteckte Gebühren
GST settlement – a payment made to the ATO by the small business to settle GST payable.

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