profit – the amount of money earnedover and above the amount spent to keep the business operating.
Accounts receivable – This type of account refers to amounts of future cash receipts that are due from customers (i.e., amounts to be collected in the future) and are shown on the asset side of the balance sheet.
What occurs during financing activites? – -where a company needs to acquire money in order to support its operations
1. debt financing : borrowing money from creditors
2. equity financing: selling stocks to investors
A Decrease in proprietor"s capital can result in What (2) ways – 1. Owner taking assets out of business

2. Payment of an expenses

Managerial Accounting – To help managers in operating. Management reports, future budgets, forecasts, historical data. Not public, only to improve managers performance.
Liabilities – Amounts owed to creditors.
dividend payment date – the date the payment is made to the shareholders.
debit dividends payable, credit cash
Fair value – the amount that a business could sell an asset for, or the amount that a business could pay to settle a liability.
A “London-type” smog is characterized by ______________.
Authorizing transactions and maintaining c – …
sales discount – a cash discount on sales
We can identify operating activities from income statement information and changes in: – current asset and liability accounts
outstanding checks – checks that have not been deducted from the bank statement balance.
Differential revenue – The difference in revenue between two alternatives (p44)
Gross Profit Rate – Gross Profit expressed as a % by dividing the amount of gross profit by net sales
Identify which basic assumption of accounting is best described in each item below.

(a) The economic activities of FedEx Corporation are divided into 12-month periods for the purpose of issuing annual reports.

(b) Solectron Corporation, Inc. does not adjust amounts in its financial statements for the effects of inflation.

(c) Walgreen Co. reports current and noncurrent classifications in its balance sheet.

(d) The economic activities of General Electric and its subsidiaries are merged for accounting and reporting purposes. – A. Periodicity
B. Monetary Unit
C. Going Concern
D. Economic Entity

A “Lоndоn-type” smоg is chаrаcterized by ______________.
cut costs – Kosten kürzen, senken

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