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Accounting Ch.14
| Term | Definition |
|---|---|
| Retained Earnings | An amount earned by a a corporation and not yet distributed by stockholders |
| Dividends | Earnings distributed to stockholders |
| Board of Directors | A group of persons elected by the stockholders to manage a corporation |
| Declaring a Dividend | Action by board of directors to distribute corporate earnings to stockholders |
| Merchandise Inventory | The amount of goods on hand for sale to customers |
| Uncollectible Accounts | Accounts receivable that cannot be collected |
| Allowance Method of Recording Losses from Uncollectible accounts | Crediting the estimated value of uncollectible accounts to a contra account |
| Book value | The difference between an asset's account balance and its related contra account balance |
| Book value of accounts receivable | The difference between the balance of accounts receivable and its contra account allowance for uncollectible accounts |
| current Assets | Cash and other assets expected to be exchanged for cash or consumed within a year |
| Plant Assets | Assets that will be used for a number of years in the operation of a business |
| Depreciation Expense | The portion of a plants assets cost that is transferred to an expense account i each fiscal period during a plants asset's useful life |
| Estimated Salvage Value | The amount an owner expects to receive when a plant asset is removed from use |
| Straight-Line Method of Depreciation | Charging an equal amount of depreciation expense for a plant asset in each year of useful life |
| Accumulated Depreciation | The total amount of depreciation expense that has been recorded since the purchase of a plant asset |
| Book Value of a Plant Asset | The original cost of a plant asset minus the accumulated depreciation |
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bailey.baucom69
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