A corporation’s net income after income taxes minus the dividends pertinent to the preferred shares of stock (if any).
A corporation’s net income after income taxes minus the dividends pertinent to the preferred shares of stock (if any).
See incremental cost.
A certified public accountant (CPA) who practices accounting in his or her own firm without another CPA as a partner or shareholder.
Also referred to as manufacturing overhead, factory burden, factory overhead, and manufacturing support costs. To learn more, see Explanation of Manufacturing Overhead.
A series of equal amounts occurring at the beginning of each equal time interval. Also known as an annuity due. An example would be the monthly rent on an apartment.
The owner’s equity account that contains the amount invested in the sole proprietorship by Matt Jones plus the net income since the company began minus the draws made by Matt Jones since the company began. The...
A lien on real estate to protect a lender. The loan made with such security is referred to as a mortgage loan.
Savings accounts and certificates of deposits at a bank.
A current liability account that reports the amounts owed to employees for hours worked but not yet paid as of the date of the balance sheet.
Preferred stock where the dividend could be more than the original, stated dividend.
A requirement that the receiving nonprofit organization must return an asset to the donor in the event that some future and uncertain event does or does not occur.
The statement of comprehensive income covers the same period of time as the income statement, and consists of two major sections: Net income (taken from the income statement) Other comprehensive income (adjustments...
A stated legal amount often appearing on preferred stock, bonds, and some common stock.
Often a 1% or 2% reduction in the amount owed if an invoice is paid within 10 days of the invoice date instead of the customary 30 days.
In regression analysis this is a statistic designated as r and ranging from -1 to +1. It indicates the percentage of correlation between the dependent variable and the independent variable(s). When this statistic is...
Federal government securities sold at a discount (because of no interest payments) with maturity dates of less than one year.
See activity-based costing.
A report prepared by a professional appraiser with detailed information on the calculation of an asset’s current market value.
Repairs that do not improve an asset or extend the asset’s life. These repairs are charged to Repairs Expense or Maintenance Expense when incurred. Major repairs such as a complete engine overhaul that extends the...
See accrued payroll.
A check drawn on a bank. A cashier’s check leaves no doubt that the funds represented by the check are real. A bank money order or a certified check would also assure the payee that the funds are in the bank.
Comprehensive income consists of the following two components (which are reported on the statement of comprehensive income): Net income (or loss) from the income statement, and Other comprehensive income (some...
See budgetary slack.
Also referred to as peripheral activities. A company’s activities outside of its main activities of buying/producing and selling. Examples include a retailer’s financing function involving interest revenue...
A corporation with a limited number of stockholders and whose stock is usually not publicly traded.
See paid-in capital in excess of par value – preferred stock.
The first-in, first-out cost flow assumumption under the perpetual inventory system. The first (oldest) costs are the first costs removed from inventory at the time that goods are sold. The most recent costs will remain...
See working capital.
Where can I find an illustration of a common size balance sheet? You will find an illustration of a common size balance sheet under AccountingCoach.com’s Explanation of Financial Ratios. The common size balance sheet...
The combination of direct materials and direct labor.
A bond (long-term debt) that is secured by a lien on real estate.
For example.
An organization established by the U.S.’s Sarbanes-Oxley Act to oversee the auditors of corporations whose stock is publicly-traded. The PCAOB’s board members are appointed by the Securities and Exchange...
A decentralized division of a corporation which is responsible for and has control over its costs, revenues, and investments.
An asset account which is expected to have a credit balance (which is contrary to the normal debit balance of an asset account). The contra asset account is related to another asset account. For example, the contra asset...
A designation awarded by one of 50 U.S. states or five jurisdictions to a college graduate who has passed the rigorous Uniform CPA Exam and has met the required work experience. See Accounting Careers.
Receivables due from customers. See accounts receivable.
See chief financial officer.
See just-in-time (JIT).
A liability account with a debit balance. Discount on Bonds Payable is a contra account associated with the liability account Bonds Payable.
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