Chapter 9 Vocabulary Flashcards Preview

ACC 101 > Chapter 9 Vocabulary > Flashcards

Flashcards in Chapter 9 Vocabulary Deck (19):
1

accelerated depreciation method

A depreciation method that provides for a higher depreciation amount in the first year of the asset’s use; followed by a gradually declining amount of depreciation.

2

account form

The periodic transfer of the cost of an intangible asset to expense.

3

book value

The cost of a fixed asset minus accumulated depreciation on the asset.

4

boot

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

5

capital expenditures

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

6

copyright

An exclusive right to publish and sell a literary; artistic; or musical composition.

7

depletion

The process of transferring the cost of natural resources to an expense account.

8

depreciation

The systematic periodic transfer of the cost of a fixed asset to an expense account during its expected useful life.

9

double-declining-balance method

A method of depreciation that provides periodic depreciation expense based on the declining book value of a fixed asset over its estimated life.

10

fixed asset turnover ratio

The number of dollars of sales that are generated from each dollar of average fixed assets during the year; computed by dividing the net sales by the average net fixed assets.

11

goodwill

An intangible asset that is created from such favorable factors as location; product quality; reputation; and managerial skill.

12

intangible assets

Long-term assets that are useful in the operations of a business; are not held for sale; and are without physical qualities.

13

patents

Exclusive rights to produce and sell goods with one or more unique features.

14

residual value

The estimated value of a fixed asset at the end of its useful life.

15

revenue expenditures

Costs that benefit only the current period or costs incurred for normal maintenance and repairs of fixed assets.

16

straight-line method

A method of depreciation that provides for equal periodic depreciation expense over the estimated life of a fixed asset.

17

trade-in allowance

The amount a seller allows a buyer for a fixed asset that is traded in for a similar asset.

18

trademark

A name; term; or symbol used to identify a business and its products.

19

units-of-output method

A method of depreciation that provides for depreciation expense based on the expected productive capacity of a fixed asset.