The date that determines which stockholders are entitled to receive a corporation’s declared dividend. No accounting entry is made on this date.
The date that determines which stockholders are entitled to receive a corporation’s declared dividend. No accounting entry is made on this date.
To assign costs to a product, department, customer, etc. on an arbitrary basis. For example, the heating cost might be allocated to the five departments located in the area that is heated. The allocation is often based...
The assigning or dividing up of amounts. For example, depreciation is an allocation process because it assigns an asset’s cost to expense in each of the years the asset is expected to be used. There is also an...
See freight-in.
Gains result from the sale of an asset (other than inventory). A gain is measured by the proceeds from the sale minus the amount shown on the company’s books. Since the gain is outside of the main activity of a...
The estimated volume in a future period that will be used for allocating indirect manufacturing costs.
See inventory conformity rule.
Under accrual accounting an item has been “earned” and is reported as revenue when a service has been performed or the ownership to a product has been transferred from the seller to the buyer (not when cash...
The symbol that represents the total cost in the equation of the cost line y = a + bx.
A journal entry to correct an erroneous amount previously entered in the general ledger.
One of the main financial statements of a nonprofit organization. This financial statement reports the revenues and expenses and the changes in the amounts of each of the classes of net assets during the period shown in...
In accounting and bookkeeping this term is used to describe paying a vendor more than once for the amount owed.
One component of financial statement analysis. This method involves financial statements reporting amounts for several years. The earliest year presented is designated as the base year and the subsequent years are...
The current asset that represents the amount of interest revenue that was reported as earned, but has not yet been received.
Expenses that vary with some activity. For example, sales commissions expense and cost of goods sold will be greater when sales are greater; electricity expense will decrease when machine hours are reduced.
The term used by manufacturers to indicate that the manufacturing overhead applied or assigned to its production is greater than the amount actually incurred.
See accrual-type adjusting entry.
Expenses which do not change in response to reasonable changes in sales or other activity.
A company’s loss before nonoperating or other items. Other or nonoperating items include interest income, interest expense, and gains and losses on sale of assets used in the business, loss on lawsuit, etc.
Used in conjunction with cost or expense behavior. Mixed expenses consist of a constant or fixed portion and a variable portion. For example, sales salaries would be a mixed expense if each sales person’s...
See functional and natural matrix.
Cash that can be used only for the purpose intended.
Goods or services provided instead of money.
See chief executive officer.
The result of subtracting total liabilities from total assets. It is also the term used by not-for-profit organizations instead of owner’s equity or stockholders’ equity. To learn more see our Explanation of...
A listing of the materials included in a product. A bill of material could be thought of as a bakery’s recipe for producing one of its products.
The abbreviation for the accounting and bookkeeping term debit.
The increase in a carrying amount. Also see write-up work.
The amount that a bank commits to lend a borrower during a specified purpose.
The Certified Management Accountant (CMA) Exam is a 13-hour, four-part exam on business analysis, management accounting and reporting, strategic management, and business application. The exam is administered through IMA,...
A detailed plan with dollar amounts. Examples of budgets used in business include the cash budget, sales budget, production budget, department budgets, the master budget, and the capital expenditures budget. Some budgets...
One of the cost flow assumptions associated with the periodic inventory system. The latest (recent) costs of goods purchased are removed from inventory first and are charged to the income statement as cost of goods sold....
A report prepared by a professional appraiser with detailed information on the calculation of an asset’s current market value.
Things that are resources owned by a company and which have future economic value that can be measured and can be expressed in dollars. Examples include cash, investments, accounts receivable, inventory, supplies, land,...
The depreciation computed for financial reporting purposes—as opposed to income tax depreciation. To learn more, see Explanation of Depreciation.
See chief financial officer.
The total of interest and principal payments required to be paid on loans payable.
The difference in total revenues between alternative actions or plans.
See incremental cost.
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