Accounting Chapter 4 Vocab

LIFO – in which the last cost s into inventory are the first costs out to cost of goods sold.
Capitalizing – recording expenditures as assets and charging them to expense by a systematic allocation over a number of years
Debit Balance in Retained Earnings (Deficit) – arises when a corporation's lifetime losses and dividends exceed lifetime earnings (deficit)
Rent Revenue – 1. Revenue
2. Income Statement
3. Credit
4. Temporary
sales invoice – a source document for recording a sale on account
Cash flow – The movement of cash into and out of a business
Expenses – Expenses are a decrease in assets or increase in liabilities which causes a decrease in equity and is not a distribution to the owner.
Which of the following activities is NOT a dimension of globalization?
return on the market value of equity – net income divided by the market value of equity
Calculate liquid ratio – Current assets less (inventory plus prepayments) divided by current liabilities less secured bank overdraft :1
Which оf the fоllоwing аctivities is NOT а dimension of globаlization?
Contingent Liabilities – future "estimated" liabilities from lawsuits and other types of events
1.) If "Remote" – no accrual or disclosure in the footnotes is required
2.) If "Reasonably Possible" – no accrual; must disclose in footnotes
3.) If "Probable" but cannot be estimated – no accrual; must disclose in footnotes
4.) If "Probable" and can be estimated – must record/book accrual and disclose in footnotes
Withdrawals. – Assets taken out of a business for the owner's personal use
balance sheet – a financial statement that reports assets, liabilites, and owner's equity on a specific date
Check – A business form ordering a bank to pay cash from a bank account

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