Accounting Ii Chapter 21 Vocabulary

Credit – An entry recording a sum received, listed on the right-hand side or column of an account.
Asset – Paid for
Company controlled
Has value
Has historical cost
Cash to suppliers – Accounts payable. Opening balance
+credit purchases
– discount received
– purchase returns
Less closing amount
Can management influence the ratios that measure liquidity – Yes
External Transactions – Exchanges of economic value between one entity and another entity.
Goodwill is classified as a/an – Intangible asset
Petty cash – an amount of cash kept on hand and used for making small payments
Return – Activity and profitability
Common stock and bond brokerage statements are an example of a(n) __________ record.
ledger – group of accounts for business entity
Inventory Turnover – (COGS/Ave. Inventory), remember 365/inventory turnover = # days items remain in inventory
Return on assets – net income/ average total assets
other expenses – A nonoperating-activities section of the income statement that shows expenses and losses unrelated to the company's main line of operations.
materiality – judgment on weather an items size makes a difference
Accounts Payable – Liability
pay cash in the near future
Cоmmоn stоck аnd bond brokerаge stаtements are an example of a(n) __________ record.
long term liabilities – Fixed liabilities

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