Accounting 610 Chapter 1

Accounts Receivable Ledger – Ledger used by merchandising business that has accounts for credit customers.
Catalog of Federal Domestic Assistance – CFDA – A database which helps the federal government track all programs it has domestically funded.
predetermined overhead rate – an overhead rate computed using
estimated data.
Liabilities – Amounts owned. You owe something/someone
Fair Value Principle – Assets and liabilities should be reprted at fair value
income statement – A financial statement that presents the revenues and expenses and resulting net income or net loss of a company for a specific period of time.
Which of the following represents the difference between the total assets and the total liabilities? – Owner's equity, Net worth, and Capital
accrual method – transactions are recorded in the period to which they relate, regardless of when cash is exchanged
controlling – identifying what went wrong, monitoring operating results and comparing actual results with the expected results.
Fermentation occurs if
What is Equity? – Contributed Capital and retained earnings
Gross Profit Percentage – Gross Profit / Net Sales

Amount of $ left, from Sales per dollar, to cover expenses and profit

Fermentаtiоn оccurs if
normal balance – side of an account that is increased
The issues which the FASB and IASB must address in developing a common conceptual framework include all of the following except:

A. should a single measurement method such as historical cost be used?

B. should the characteristic of reliability be traded-off in favor of information that is verifiable?

C. should the role of financial reporting focus on stewardship as well as providing information to assist users in decision making?

D. should the common framework lead to standards that are principles-based or rules-based? – C. should the role of financial reporting focus on stewardship as well as providing information to assist users in decision making?

Double Entry System – A system of accounting in which every transaction affects at least two accounts.

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