Chapter 4 Double Entry Accounting

comparability – összevethetÅ‘ség
Periodic end of period adjustments – count is necessary to determine amount of ending inventory to commute COGS. Company does not know what ending inventory should be- cannot tell whether goods were sold, lost, stolen or spoiled.
Sales journals should be entered monthly by – pencil footing
cross footing
posting
Financial accounting – Area of accounting aimed mainly at serving external users
Capital allocations – It promotes productivity, encourages inovation, and provide an efficient and liquid market for buying and selling securities and obtaining in granting credit.

Unreliable and irrelevant information leads to poor capital allocation , which adversely affects the securities markets.

revenues – the act of providing a good or service to customers
to be appointed – to be officially choosen for a job or responsibility
Companies should ask if candidates are subject to any post-termination agreements with prior employers to reduce legal liability.
general journal – A log of the transactions engaged in by the business.
fixed asset – befektetett eszköz, (állóeszköz)
Current cost – The cost of replacing an asset
Closing the books – Transfers the year-end balances of all income statement accounts to the retained earnings accounts. Dividends account is also closed to retained earnings
Accounting work performed for a federal, state, or local gov't unit. – governmental accounting
The owner invests personal $ in the business, assets __ – Increase
How much inventory did the company have on hand on december 31, 2002? – Assets, Balance Sheet on December 31, 2002
Cоmpаnies shоuld аsk if cаndidates are subject tо any post-termination agreements with prior employers to reduce legal liability.
trial balance – A proof of the equality of debits and credits in a general ledger
Net Loss – EXPENSES Greater than REVENUE = NET LOSS
Markup – The amount added to the cost of merchandise to establish the selling price

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