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Principles of Accounting > Glossary B-C > Flashcards

Glossary B-C Flashcards

1
Q

Define

bad debt expense

glossary

A

The operating expense incurred because of the failure to collect receivables.

glossary

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2
Q

Define

balance sheet

glossary

A

a statement of the assets, liabilities, and capital of a business or other organization at a particular point in time

glossary

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3
Q

Define

bank reconciliation

glossary

A

The analysis that details the items responsible for the difference between the cash balance reported in the bank statement and the balance of the cash account in the ledger.

glossary

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4
Q

Define

bond

glossary

A

An interest-bearing note that requires periodic interest payments, with the face amount to be repaid at the maturity date.

glossary

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5
Q

Define

bond indenture

glossary

A

The contract between a corporation issuing bonds and the bondholders

glossary

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6
Q

Define

book value of the asset

glossary

A

The difference between the cost of a fixed asset and its accumulated depreciation.

glossary

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7
Q

Define

boot

glossary

A

The amount a buyer owes a seller when a fixed asset is traded in on a similar asset.

glossary

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8
Q

Define

business entity concept

glossary

A

A concept of accounting that limits the economic data in the accounting system to data related directly to the activities of the business

glossary

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9
Q

Define

capital account

glossary

A

An account used for a proprietorship that represents the owner’s equity.

glossary

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10
Q

Define

capital expenditures

glossary

A

The costs of acquiring fixed assets, adding to a fixed asset, improving a fixed asset, or extending a fixed asset’s useful life.

glossary

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11
Q

Define

carrying amount

glossary

A

The book value of bonds payable, computed as the face amount less any unamortized discount or plus any unamortized premium.

glossary

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12
Q

Define

cash basis of accounting

glossary

A

A basis of accounting in which revenues and expenses are reported on the income statement in the period in which cash is received or paid.

glossary

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13
Q

Define

cash equivalents

glossary

A

Highly liquid investments that are usually reported with cash on the balance sheet.

glossary

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14
Q

Define

cash flow per share

glossary

A

The net cash flows from operat- ing activities divided by the number of common shares outstanding.

glossary

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15
Q

Define

cash flows from (used for) financing activities

glossary

A

The section of the statement of cash flows that reports cash flows from transactions affecting the equity and debt of the business.

glossary

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16
Q

Define

cash flows from (used for) investing activities

glossary

A

The section of the statement of cash flows that reports cash flows from transactions affecting investments in noncurrent assets.

glossary

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17
Q

Define

cash flows from (used for) operating activities

glossary

A

The section of the statement of cash flows that reports the cash transactions affecting the determination of net income.

glossary

18
Q

Define

cash short and over account

glossary

A

An account which has recorded errors in cash sales or errors in making change causing the amount of actual cash on hand to differ from the beginning amount of cash plus the cash sales for the day.

glossary

19
Q

Define

chart of accounts

glossary

A

A list of the accounts in the ledger.

glossary

20
Q

Define

closing entries

glossary

A

The entries that transfer the balances of the revenue, expense, and drawing accounts to the owner’s capital account

glossary

21
Q

Define

closing process

glossary

A

The transfer process of converting temporary account balances to zero by transferring the revenue and expense account balances to the owner’s capital account, and transferring the owner’s drawing account balance to the owner’s capital account.

glossary

22
Q

Define

closing the books

glossary

A

The process of transferring temporary accounts balances to permanent accounts at the end of the accounting period.

glossary

23
Q

Define

common stock

glossary

A

The stock outstanding when a corporation has issued only one class of stock.

glossary

24
Q

Define

common-sized statement

glossary

A

A financial statement in which all items are expressed as percentages, with no dollar amounts shown.

glossary

25
Q

Define

compensating balance

glossary

A

A requirement by some banks requiring depositors to maintain minimum cash balances in their bank accounts.

glossary

26
Q

Define

comprehensive income

glossary

A

All changes in stockholders’ equity during a period, except those resulting from dividends and stockholders’ investments.

glossary

27
Q

Define

consolidated financial statements

glossary

A

Financial statements resulting from combining parent and subsidiary statements.

glossary

28
Q

Define

contingent liabilties

glossary

A

Liabilities that may arise from past transactions if certain events occur in the future.

glossary

29
Q

Define

contra accounts

glossary

A

An account offset against another account.

glossary

30
Q

Define

controling account

glossary

A

The account in the general led- ger that summarizes the balances of the accounts in a subsidiary ledger.

glossary

31
Q

Define

corporation

glossary

A

A business organized under state or federal statutes as a separate business entity.

glossary

32
Q

Define

cost concept

glossary

A

A concept of accounting that determines the amount initially entered into the accounting records for purchases.

glossary

33
Q

Define

cost method

glossary

A

A method of accounting for bond invest- ments in which the purchase is recorded at original cost, including any fees charged by a broker in acquiring the bonds, and any accrued interest is recorded separately.

glossary

34
Q

Define

cost of merchandise sold

glossary

A

The cost of merchandise inventory that is reported as an expense when merchandise is sold; on the income statement of a merchandising business, determined by subtracting ending merchandise inventory from the cost of merchandise available for sale.

glossary

35
Q

Define

credit

glossary

A

Amount entered on the right side of an account.

glossary

36
Q

Define

credit memorandum

glossary

A

A form used by a seller to inform the buyer of the amount the seller proposes to credit to the account receivable due from the buyer

glossary

37
Q

Define

credit period

glossary

A

The amount of time the buyer is allowed in which to pay the seller.

glossary

38
Q

Define

cumulative preferred stock

glossary

A

Stock that has a right to receive regular dividends that were not declared (paid) in prior years.

glossary

39
Q

Define

current assets

glossary

A

Cash and other assets that are expected to be converted to cash or sold or used up, usually within one year or less, through the normal operations of the business.

glossary

40
Q

Define

current liabilties

glossary

A

Liabilities that will be due within a short time (usually one year or less) and that are to be paid out of current assets.

glossary

41
Q

Define

current ratio

glossary

A

A financial ratio that measures a company’s ability to pay its current liabilities, computed by dividing current assets by current liabilities.

glossary

Principles of Accounting (15 decks)

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