Accounting Chapter 6

financial accounting – focuses on needs of external users
Payroll – The total amount earned by all employees for a pay period.
Misleading cost numbers are MOST likely the result of misallocating:
a. direct material costs
b. direct manufacturing labor costs
c. indirect costs
d. All of these answers are correct. – c. indirect costs
Direct costs – are identified with and can be traced to a cost object.
Consignee – the person or business concern to whom a shipment is made is a
income statement – reports the revenue earned less the expenses incurred by a business over a period of time.
Three ingredients of Relevance – Predictive Value
Confirmatory Value
Work sheet – a columnar accounting form used to summarize the general ledger information needed to prepare financial statements
True – A withdrawal decreases owners equity
Lessor – Party to a lease who grants another party (the lessee) the right to possess and use its property.
It has been proven that smoking, eating, or drinking at a crime scene will not compromise evidence or hinder an investigation:
Source documents provide information about… – cash payments, cash receipts, sales of goods and services,purchase of goods and services.
Financial Expenses – Expenses resulting from the use of money, e.g. interest.
when its earned – when is revenue recognized
Cost Of Goods Sold – When a product is shipped the total cost of manufacturing the product is expensed from inventory and recorded on that section of the income statement.
It hаs been prоven thаt smоking, eаting, оr drinking at a crime scene will not compromise evidence or hinder an investigation:
closing entries – entries at the end of an accounting period to transfer the balances of temporary accounts to a permanent stockholders' equity account, Retained Earnings

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