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Accounting ll
Ch. 25 vocab
Term | Definition |
---|---|
Stockholder | An owner of one or more shares of a corporation. |
Retained Earnings | An amount earned by a corporation and not yet distributed to stockholders. |
Dividends | Earnings distributed to stockholders. |
REMEMBER: Dividends | Dividends is a temporary account that is closed to Retained Earnings at the end of the fiscal period. |
Board of Directors | A group of persons elected by the stockholders to manage a corporation. |
CONCEPT: Business Entity | Financial information is recorded and reported separately from the owner's personal financial information. |
Declaring a Dividend | Action by a board of directors to distribute corporate earnings to stockholders. |
CONCEPT: Accounting Period Cycle | Changes in financial information are reported for a specific period of time in the form of financial statements. |
REMEMBER: Merchandise Inventory | If the ending merchandise inventory is less than the beginning merchandise inventory, the difference (decrease) is debited to Income Summary and credited to Merchandise Inventory. |