Century 21 Accounting Chapter 6

Revenues – The gross increase in stockholders equity resulting from business activities entered into for the purpose of earning income.
shareholder – a person who buys stock in the corp.
Sunk cost – Past cost that has been paid or committed to
DEBIT Cash and Sales Discounts, CREDIT Accounts Receivable – To record cash received from another company for the balance due of merchandise sold with discount.
residual value – the estimated price for which an asset may be sold when it is no longer serviceable to the business
-also called salvage value
Income statement – Statement that details performance (revenue -expense)
liquidity – the ability to pay obligations as hey mature
* meet unexpected needs for cash
Credit – when you buy property and agree to pay for it later.
Interpreting. – Explaining the significant events or developments that occur, usually taking the form of analysis and comparisons.
Accounting period – income is measured for a span of time
Which statement about plasma proteins is false?
balance sheet – a financial statement that reports assets, liabilities, and owner's equity on a
specific date
Faithful Representation – Useful information should be complete, neutral, and free from error.
*sales* – The total amount charged customers for merchandise sold, including cash sales and sales on account.
Legal Capital – Most states require companies to maintain a minimum amount of stockholders' equity for the protection of creditors. This is usually the par value of the shares issued
Earnings per share – the amount of net income after federal income tax belonging to a single share of stock
Which stаtement аbоut plаsma prоteins is false?
Work Sheet – used to summarize general ledger information to prepare financial statements
Cost of Goods Manufactured (CGM) – =Total cost of current period's output
periodic – inventory and cost of goods sold updated only at the end of the period
no hidden extras – keine versteckten Kosten
revenue recognition principle – provides guidance on when a company must recognize revenue

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