College Accounting Chapters 14

Sales Return – A firm's acceptance of a return of goods from a customer.
Owner's equity – The claim of the owners of a business to the assets of the business. Also called capital, stockholder's equity, or net assets.
JJ White planned to use $82 of material per unit but actually used $80 of material per unit, and planned to make 1,200 units but actually made 1,000 units.

The sales-volume variance is:
a. $2,000 favorable
b. $14,000 unfavorable
c. $16,400 unfavorable
d. $2,400 favorable – c. $16,400 unfavorable

operating income – Gross profit minus operating expenses plus any other operating revenues. Also called income from operations.
acrobat – One who does daring gymnastic stunts
capital – The account used to summarize the owner's equity in a business.
Debit – An entry on the left side of an account.
5. The set of elements common to both set A and set B is the
deudores en gestión judicial – debtors in litigation
Sales revenue less cost of goods sold is called net profit.
A. True
B. False – False
sales returns and allowances – a temporary owner's equity contra account used to record credit given to a customer for shortages or damaged goods.
5. The set оf elements cоmmоn to both set A аnd set B is the
annuity – series of equal periodic payments or receipts
Reversing Entries – Journal entries made to reverse the effect of certain adjusting entries involving accrued income or accrued expenses to avoid problems in recording future payments or receipts of cash in a new accounting period.
Gross Profit – Sales – COGS (beg.inv.- end inv.)
What to do when there's a net loss in Budgeted Income Statement – where a net loss is predicted the owner can respond by:
– cutting down their expenses
– increase cash fees by: changing prices, advertising, providing promotions/discounts
– seeking cheaper suppliers
– making prices cheaper to increase customer demand
– Examining roasters to ensure appropriate staffing levels.
Lifo – Last in, first out: is an assignment method, it doesn't track physical units

Assumes that the oldest item is sold last
Is open to manipulation

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