Accounting: Chapter 6 Vocab

Sales Invoice Information – – Credit Sale
– Increase GST Liability
producing departments – units within an organization responsible
for producing the products or services that are sold to customers.
Owner's Equity – Owner's Equity is the residual interest in the assets of the entity after deducting all its liabilities.
A=L+OE or OE=A-L
If there was no beginning work in process and no ending work in process under the weighted-average process costing method, the number of equivalent units for direct materials, if direct materials were added at the start of the process, would be:
a. equal to the units started or transferred in
b. equal to the units completed
c. less than the units completed
d. Both a and b are correct. – d. Both a and b are correct.
The International Accounting Standards Board (IASB) mission – To develop a single set of high quality, understandable and international financial reporting standards (IFRSs) for general-purpose financial statements (GPFS)
what are the 4 statements – income statement, statement of returned earning, balance sheet, statement of cashflow
Allowance – Buyer keeps merchandise but is given a price reduction due to merchandise defect
Consigned goods – Gods held for sale by one party although ownership of the goods is retained by another party.
zero based budgeting – A method of budgeting in which all expenses must be justified for each new period
A list of accounts that shows the arrangement of the accounts in the ledger is called – Chart of accounts
The Catholic Church's response to the Protestant Reformation is known as this: ______________ ____________________.
weighted-average unit cost – average cost that is weighted by the number of units purchased at each unit cost
allowance method – splits the accounting into two entries
1. record an estimate of bad debt expense
2. write-off receivable when they become uncollectible
Summarizing – Bringing the various items of info together to determine a result
Owner's equity – The amount remaining after the value of all liabilities is subtracted from the value of all assets
managerial accounting – The branch of accounting that provides information to various management levels for the enhancement of controls, usually in the form of budgets
percent change – (2008-2007)/(2007)
Retained Earning Equation – Ending Retained Earnings = (Beginning of Retained Earnings + Net Income) – Dividends
The Cаthоlic Church's respоnse tо the Protestаnt Reformаtion is known as this: ______________ ____________________.
FASB – Financial Accounting Standards Board – independent – set accounting rules
interest – economic benefit earned by the payee for loaning the principal to the maker
Deferred income – Income earned but not received is called.
periodicity assumption – an assumption that the economic life of a business can be divided into artificial time periods
Discuss accounting as the language of business and the role of accounting information in making economic decisions. L01 – Because accounting is widely used to descirbe all types of business activity, it is sometimes referred to as the language of business. Costs, prices, sales volume, profits, and return on investment are all accounting measurements. Investors, creditors, managers, and others who have a financial interest in an enterprise need a clear understanding of accounting terms and concepts if they are to understand and communicate about the enterprise.

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