A lien on real estate to protect a lender. The loan made with such security is referred to as a mortgage loan.
A lien on real estate to protect a lender. The loan made with such security is referred to as a mortgage loan.
’ equity section of the balance sheet, the cash that was generated from those retained earnings is not likely be in the company’s checking account. Instead, the corporation likely used the cash to acquire additional...
Actions taken or not taken prior to issuing financial statements in order to improve the amounts appearing in the financial statements.
The party receiving goods to be sold. See consigned goods.
How can I determine the difference in earnings from using LIFO instead of FIFO? The difference in a corporation’s earnings from using LIFO instead of FIFO can be determined by the amounts reported in the balance sheet...
Checks which have been written, but have not yet cleared the bank on which they were drawn. In the bank reconciliation, outstanding checks are deducted from the balance per bank. To learn more, see Explanation of Bank...
The date that determines which stockholders are entitled to receive a corporation’s declared dividend. No accounting entry is made on this date.
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...
arrangement that assures that the long-term debt will be replaced with new long-term debt or with capital stock. Join PRO to Track Progress Mark the Question as Read Must-Watch Video Learn How to Advance Your Accounting...
The process of comparing the amounts in the Cash account in the general ledger to the amounts appearing on the bank statement. The objective is to be certain that there is consistency between the amounts and that the...
The estimated volume in a future period that will be used for allocating indirect manufacturing costs.
See inventory conformity rule.
A term associated with petty cash. Replenish means to return the amount of actual cash in the petty cash box back to the amount appearing in the general ledger account Petty Cash. This is done whenever the amount of...
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 day after the record date for a cash dividend on shares of stock. Theoretically, the market price of the stock should drop on this day by the amount of the dividend.
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...
Sales made on account. Sales where the customer is allowed to pay at a later date. Noncash sales.
Also referred to as shareholders’ equity. At a corporation it is the residual or difference of assets minus liabilities. To learn more about stockholders’ equity, see our Stockholders’ Equity Outline.
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.
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.
Under the accrual basis of accounting the account Supplies Expense reports the amount of supplies that were used during the time interval indicated in the heading of the income statement. Supplies that are on hand...
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.
What is the procedure for preparing a trial balance? Definition of a Trial Balance A trial balance consists of the following information: The title of each general ledger account that has a balance To the right of the...
An asset account in a bank’s general ledger that indicates the amount at which the bank is reporting or carrying its investments.
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.
A balance on the right side (credit side) of an account in the general ledger.
The increase in a carrying amount. Also see write-up work.
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