Accounting Chapter 5

bond – a certificate that represents a corporation's promise to repay a certain amount of money and interest in the future
Assets – Things of value with a specific dollar amount owned by a business/person.
Cost Constraint – providing info is costly. The cost gathering the info should be weighed against the benefit users will receive from it
INVENTORY TURNOVER – RATIO OF COST OF GOODS SOLD / AVERAGE INVENTORY

MEASURE OF THE NUMBER OF TIMES A COMPANY SELLS ITS AVERAGE LEVEL OF INVENTORY DURING A PERIOD

poulterer – one who sells poultry
Account vs. General ledger – Account is a record of increases and decreases in a specific asset, liability, equity, etc. A ledger is a combination of all accounts.
Merger – Occurs when one company purchase all of the assets and liabilities of another and the acquired company goes out of existence.
Ethics – the principles of right and wrong that guide an individual in making decisions
bank statement – a report of deposits, withdrawals, and bank balances sent to a depositor by a bank
A way to spread the cost of long-term assets over the periods in which they are used – Depreciation and why its necessary
Two major sources of genetic variation are mutations and _______.
Treasury stock – Own corporations stock bought back. Reasons why include shares to give to employees, boost back underpriced stock.
Revenues – Expenses – = Net Income
Chart of Accounts. – A list of all the account titles and the account numbers assigned to them.
articulation – describes the interrelationships among the various elements of the financial statements
Net income & investment of assets in the business by the owner – The proprietorship of a business may be increased by
Account payable ledger – A subsidiary ledger containing only accounts for vendors from whom items are purchased or bought on account.
Twо mаjоr sоurces of genetic vаriаtion are mutations and _______.
How does matching relate to accruals and deferrals – A firm uses accrual basis accounting. They are timing differences between the exchange of the goods or service and the exchange of the cash payment
The excess of current assets over current liabilities is called – Working capital

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