Accounts

legal services – Income statement
Operating expenses
Administrative expenses
Difference in net income (when units produced < units sold) – =FOH/unit x (units sold-units produced)
Bank Statement Reconciliation. – The process by which the depositor verifies agreement between his checkbook balance and the bank statement balance.
A formal report of changes that occurred in the owner's financial interest during a reporting period. – Statement of Owner's Equity
Current cost – The cost of replacing an asset
Account equation – : an equation showing the relationship among assets, liabilities, and owner's equity
Brunelleschi's Linear Perspective Experiment included the use of a:
accounting systems – The branch of accounting that covers the review of a firm's entire information system, not just the accounting system
Matching Concept – To determine net income, compute expenses involved in earning revenues and deduct total expenses from total revenues.
Why do accountants use a worksheet ? – To prepare financial statements
annuity due – assumes periodic rents occur at the beginning of each period
Proving cash – determining that the amount of cash agrees with the accounting records
Specific Identification – when a unit is sold the specific cost of the unit sold is added to cost of goods sold
Engineering approach – A detailed analysis of cost behavior based on an industrial engineer's evaluation of the inputs that are required to carry out a particular activity and of the prices of those inputs (p35)
Brunelleschi's Lineаr Perspective Experiment included the use оf а:
goodwill – purchase price of business – fair market value of its net assets
In recording an accounting transaction in a double-entry system: – C. The amount of the debits must always equal the amount of the credits

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