Accounting Chapter 1

Common Stock – A denomination of ownership.

A claim of a companies future assets and earnings

Withdrawals – Assets taken out of the business by the owner for his personal use
corporation advantages – 1. separate legal entity
2. limited liability of stockholders
3. transferrable ownership rights
4. continuous life
5. lack of mutual agency for stockholders
6. was of capital accumulation
What is amount paid in to the corporation by stockholders in exchange for shares of ownership called? – Paid in capital
Just in time processing – is a management approach that focuses on reducing time and cost and eliminating poor quality.
MOH Costs – variable or fixed costs (indirect costs)
other income – Revenue from sources other than the primary operating activity of a business (interest, rent, and gains resulting from the sale of fixed assets)
False – T or F: if two amounts are recorded on the same side of the accounting equation, the equation will no longer be in balance
CPA – Accountant licensed by the state and offering services to the public
Creating a holding environment helps regulate distress because
Which type of stock is required by the corporation to be held for future use? – Treasury Stock
Fixed deposit – Set there for a specific time period
Common stock – Term used to describe the total amount paid in by stockholders for the shares they purchase.
Customer – A person/business to whom merchandise/services are sold.
compound journal entry – journal entry that affects more than 2 accounts
ACCRUED REVENUES – revenues earned in a period that are both unrecorded and not yet received in cash; adjusting entries involve increasing assets and increasing revenue. (accounts recievable,services, products, interest, and rent)
What is the amount of stock a corporation is authorized to sell? – Authorized Stock
Creаting а hоlding envirоnment helps regulаte distress because
process-costing system – a costing system that accumulates production
costs by process or by department for a given period of
time.
Selling/Admin Costs – Costs that are not included in inventory. They are sometimes called period costs.

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