Principles Of Accounting Level 1 Chapter 1

debit entry – Sollbuchung, Belastung
International financial reporting standard – Accounting procedures that could replace GAAP
debit and credit – double entry bookkeeping means an entry is made as a/an
Revenues – Are recognized when earned which means the goods or services are provided; not when cash is collected
Deferral – describes an earnings event that is recognized after cash has been exchanged
Credit card sales – A sale in which a credit card is used for the total amount of the sale at the time of the transaction
Inventory Turnover – (Current Year COGS)/((BI + EI)/2)
*Important to turn over at a reasonable rate
365/Inventory Turnover gives how many days for turnover
Comparability – Important for making comparisons between firms.
The cost of a machine purchased last year will be irrelevant in a decision for next year. – True
Which of the following is one of the Fed's policy goals?
Declaration Date – Board of Directors declares that a dividend be paid in cash
Interpreting. – Explaining the significant events or developments that occur, usually taking the form of analysis and comparisons.
Work in process – that portion of manufactured inventory that has begun the production process but is not yet complete
manufacturing – change basic inputs into products sold to customers
Which оf the fоllоwing is one of the Fed's policy goаls?
Mortgage payable – a longterm liability; a written promise that pledges real property as security for payment of a debt.
Internal Transactions – Activities within an organization that can affect the accounting equation.
Understandable – who is the audience
person with reasonable interest
Leverage ratio – Ratio used to find financial leverage of a company to get an idea of the companies methods of financing
An error in the ending inventory of the current period will have no effect on net income of the next accounting period.
A. True
B. False – FALSE

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