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Accounting Part 2
Chapters 9-16 Terms
| Question | Answer |
|---|---|
| capital stock | total shares of ownership in a corporation |
| cash discount | a deduction that a vendor allows on the invoice amount to encourage prompt payment |
| cash over Or Cash Short | a petty cash on hand amount that is more or less than a recorded amount |
| cash payments journal | a special journal used to record only cash payment transactions |
| contra account | an account that reduces a related account on a financial statement |
| corporation | an organization with the legal rights of a person and which many persons may own |
| cost of merchandise | the price a business pays for goods it purchases to sell |
| debit memorandum | form prepared by the customer showing the price deduction taken by the customer for returns and allowances |
| list price | the retail price listed in a catalog or on an Internet site |
| markup | the amount added to the cost of merchandise to establish the selling price |
| merchandise | goods that a business purchases to sell |
| merchandising business | a business that purchases and sells goods |
| purchase invoice | an invoice used as a source document for recording a purchase on account transaction |
| purchase on account | a transaction in which the merchandise purchased is to be paid for later |
| purchases journal | a special journal used to record only purchases of merchandise on account |
| share of stock | each unit of ownership in a corporation |
| special amount column | a journal amount column headed with an account title |
| stockholder | an owner of one or more shares of a corporation |
| trade discount | a reduction in the list price granted to customers |
| vendor | a business from which merchandise is purchased or supplies or other assets are bought |
| batch report | a report of credit card sales produced by a point-of-sale terminal |
| cash receipts journal | special journal used to record only cash receipt transactions |
| credit memorandum | a form prepared by the vendor showing the amount deducted for returns and allowances |
| point-of-sale (POS) terminal | a computer used to collect, store, and report all the information of a sales transaction |
| sales discount | a cash discount on sales taken by a customer |
| sales journal | a special journal used to record only sales of merchandise on account |
| terminal summary | the report that summarizes the cash and credit card sales of a point-of-sale terminal |
| accounts payable ledger | a subsidiary ledger containing only accounts for vendors from whom merchandise or other items are purchased on account |
| accounts receivable ledger | a subsidiary ledger containing only accounts for charge customers |
| controlling account | an account in a general ledger that summarizes all accounts in a subsidiary ledger |
| schedule of accounts payable | a listing of vendor accounts, account balances, and total amount due all vendors |
| schedule of accounts receivable | a listing of customer accounts, account balances, and total amount due from all customers |
| subsidiary ledger | a ledger that is summarized in a single general ledger account |
| employee earnings record | a business form used to record details affecting payments made to an employee |
| Medicare tax | a federal tax paid for hospital insurance |
| net pay | the total earnings paid to an employee after payroll taxes and other deductions |
| pay period | the period covered by a salary payment |
| payroll | the total amount earned by all employees for a pay period |
| payroll register | a business form used to record payroll information |
| payroll taxes | taxes based on the payroll of a business |
| salary | the money paid for employee services |
| social security tax | a federal tax paid for old-age, survivors, and disability insurance |
| tax base | the maximum amount of earnings on which a tax is calculated |
| total earnings | the total pay due for a pay period before deductions |
| withholding allowance | a deduction from total earnings for each person legally supported by a taxpayer, including the employee |
| federal unemployment tax | a federal tax used for state and federal administrative expenses of the unemployment program |
| accumulated depreciation | the total amount of depreciation expense that has been recorded since the purchase of a plant asset |
| allowance method of recording losses from uncollectible accounts | crediting the estimated value of uncollectible accounts to a contra account |
| board of directors | a group of persons elected by the stockholders to manage a corporation |
| book value | the difference between an asset’s account balance and its related contra account balance |
| current assets | cash and other assets expected to be exchanged for cash or consumed within a year |
| declaring a dividend | action by a board of directors to distribute corporate earnings to stockholders |
| depreciation expense | the portion of a plant asset’s cost that is transferred to an expense account in each fiscal period during a plant asset’s useful life |
| dividends | earnings distributed to stockholders |
| merchandise inventory | the amount of goods on hand for sale to customers |
| plant assets | assets that will be used for a number of years in the operation of a business |
| retained earnings | an amount earned by a corporation and not yet distributed to stockholders |
| straight-line method of depreciation | charging an equal amount of depreciation expense for a plant asset in each year of useful life |
| uncollectible accounts | accounts receivable that cannot be collected |
| cost of merchandise sold | the original price of all merchandise sold during a fiscal period |
| current liabilities | liabilities due within a short time, usually within a year |
| earnings per share | the amount of net income after federal income tax belonging to a single share of stockearnings per share |
| long-term liabilities | liabilities owed for more than a year |
| net sales | total sales less sales discount and sales returns and allowances |
| statement of stockholders’ equity | a financial statement that shows changes in a corporation’s ownership for a fiscal period |
| supporting schedule | a report prepared to give details about an item on a principal financial statement |
| financial ratio | a comparison between two items of financial information |
| gross profit on sales | the revenue remaining after cost of merchandise sold has been deducted |
| purchases allowance | credit allowed for part of the purchase price of merchandise that is not returned, resulting in a decrease in the customer’s accounts payable |
| purchases return | credit allowed for the purchase price of returned merchandise, resulting in a decrease in the customer’s accounts payable |
| sales allowance | credit allowed a customer for part of the sales price of merchandise that is not returned, resulting in a decrease in the vendor’s accounts receivable |
| sales return | credit allowed a customer for the sales price of returned merchandise, resulting in a decrease in the vendor’s accounts receivable |
Created by:
mryan396
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