Accounting General Journal, 9e: Chapter 01

Age of inventory – measures the average time required to sell inventory. Calculation: 365 days divided by Inventory Turnover
Know the different financial statements and their components: – 4.
equities – financial rights or claims to the assets of the business.
Declining-Balance Depreciation and formula – Is the method that allocates the cost of an asset over its useful life based on a multiple of the straight-line rate (often two times).

Depreciation Expense = ((Cost – Accumulated Depreciation) x ( 2 / Useful Life))

Financial reporting – A broad term that describes all information provided to external users, including but not limited to financial statements.
Prevention Costs – costs incurred to reduce the number of defects
average-cost method – an inventory costing method that uses the weighted-average unit cost to allocate the cost of goods available for sale to ending inventory and cost of goods sold
Many (although not all) human factors are _______________ the user's age, gender, cultural background or level of expertise.
Code of conduct – a statement that guides the ethical behavior of a company and its employees
False – When cash is paid for expenses the business has more equity
The group of accounts which you credit to increase are – Liabilities and capital
Auditors – Trained individuals hired by a company as an
independent party to express a professional opinion of the
accuracy of that company's financial statements.
restrictive endorsement – An endorsement restricting futher transfer of a check's ownership
Serial bond – Portions of principal are repaid periodically
Mаny (аlthоugh nоt аll) human factоrs are _______________ the user's age, gender, cultural background or level of expertise.
The financial interest of the owner of a business; also called proprietorship or net worth. – Owner's equity
verifiable – the quality of information that occurs when independent observers, using the same methods, obtain similar results
Current Liabilities – Obligations due within one year or within the operating cycle if longer than a year.
-2 kinds: known amounts and estimated amounts
Sales – a temporary owner's equity account used to record the earning of revenue.
Double entry – The basic accounting theory is based on

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