Accounting Chapter 5

22.Corporate culture – is the values beliefs and norms that are shared by people and groups in an organization.
Revenues received that we do not bill for (permits/fees) – DR Cash
CR Permit/Fee revenue
Sales journal – A special journal used to record only sales of merchandise on account.
40. On January 1, 2012, Gucci Brothers Inc. started the year with a $492,000 balance in Retained Earnings and a $605,000 balance in Common Stock. During 2012, the company earned net income of $92,000, paid a dividend of $15,200, and issued more common stock for $27,500. What is total stockholders' equity on December 31, 2012?
A. $1,231,700.
B. $1,097,000.
C. $1,201,300.
D. $1,588,300. – C. $1,201,300.
Liabilities – Amounts owed to other people (creditors) or institutions (banks). Future sacrifices of economics benefits (cash) that the business is currently obliged to make as a result of a past transaction, e.g. loans.
take account of inflation – die Inflation berücksichtigen
sale on account – a sale for which cash will be received at a later date
Liquidity – being in cash or easily convertible to cash
Net loss – the difference between total revenue and total expenses when total expenses is greater
When conducting a survey, it is important to use a random sample because random samples
publicly held corp. – a corp. that allows anyone to purchase their stock
Sale on Account – a sale for which cash will be received at a later date
PERIODIC INVENTORY – updates accounting recors only at the end of a period
Assets – Economic Resources expected to produce a benefit
Net Loss – the difference between total revenue and total expenses when total expenses are greater
When cоnducting а survey, it is impоrtаnt tо use а random sample because random samples
T-Account – Is a tool for summarizing transaction effects for each account, determining balances, and drawing inferences about a company's activities.
Drawing Account – Another term for Withdrawal Account
Current Ratio – A relationship between current assets and current liabilities that provides a measure of a firm's ability to pay its current debts (current ratio = current assets/current liabilities).
dividends – distributions (usually cash) by a corporation to its stockholders.
Owners equity – The difference between assets and liabilities. The amount the business owes to the owner. Also the key amount invested by owners and profit/loss from the operations of the business.

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