The record of checks issued or written, deposits, bank charges, bank credits and the resulting balance. Also referred to as the check register.
The record of checks issued or written, deposits, bank charges, bank credits and the resulting balance. Also referred to as the check register.
See first in, first out (FIFO).
A phrase used in reconciling the bank statement. It refers to the ending balance shown on the bank statement.
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An Italian monk associated with debits, credits, and double-entry accounting approximately 500 years ago.
An amount owed on bill or invoice from a vendor or supplier of goods or services.
A stakeholder is anyone that has an interest or is affected by a decision. For example, some of the stakeholders of a state university include the students, students’ families, alumni, professors, custodians,...
The statement of the Financial Accounting Standards Board entitled Financial Statements of Not-for-Profit Organizations. This statement was originally issued in June 1993 and can be read at no cost at www.FASB.org.
A lease that “in substance” is a purchase and financing arrangement. When a lease meets certain criteria, the asset being “rented” is recorded as an asset and a liability is also recorded. A lease...
A statistic known as the coefficient of determination. This statistic indicates the percent change in the dependent variable that is explained by the change in the independent variable(s).
Classifying expenses according to the type of work such as selling, administration, general, and financing.
A publication by the U.S. Internal Revenue Service (IRS) to assist employers with federal payroll taxes. The complete title of the publication is Publication 15 (Circular E), Employer’s Tax Guide. It is available...
The basic general rules upon which more detailed accounting standards are built. To learn more, see Explanation of Accounting Principles.
A term often used when referring to office workers, managers, professionals, and executives. These employees’ pay is often stated as a salary for a month (and not as an hourly pay rate).
A target rate. For example, companies may decide to invest only in projects that generate an internal rate of return that is in excess of 12%. The 12% figure becomes the hurdle rate.
A term to mean the company’s general ledger or accounting records.
The products with significant value that emerge at a split-off point in a process. When a joint product has little value it is referred to as a by-product.
The amount of principal due on a formal written promise to pay. Loans from banks are included in this account.
A retirement plan that does not specify the amount that a retiree will receive. Rather, the employer’s obligation is to contribute a specific amount into a fund to be used for payments to retirees.
A balance sheet line to report short-term liabilities that are too insignificant to be identified separately.
A current asset representing amounts paid in advance for future expenses. As the expenses are used or expire, expense is increased and prepaid expense is decreased.
A general ledger account which serves to summarize similar transactions. For example, all of the closing entries involving operating expenses might be posted to an operating expense clearing (or summary) account.
A document filed when a corporation is formed. Among other things, it lists the number of shares of stock that the corporation is authorized to issue.
Asset, liability, and owner’s equity accounts. Also referred to as permanent or real accounts. To learn more, see Explanation of Balance Sheet.
A document that indicates the quantity of goods received. This report is often matched in the accounts payable department with the purchase order and the vendor’s invoice prior to paying the vendor.
The symbol for the number of units of product, number of machine hours, or other indicator of activity or volume as shown in the equation of the cost line y = a + bx.
See inventory: work-in-process (WIP).
A current asset account which contains the amount of investments that can and will be sold in the near future.
An expense account which is expected to have a credit balance instead of the typical debit balance.
An unsecured bond. For example, a bond not secured by a lien on the issuer’s property.
The stockholders’ equity account that reports the par or stated value of the issued shares of common stock. If the common stock does not have a par or stated value, this account will report the amount received when...
The percentage resulting from dividing dividends per share by earnings per share.
A balance sheet heading or grouping that includes both cash and those marketable assets that are very close to their maturity dates.
Scrap or waste that should have been avoided. In other words, abnormal spoilage is the amount that is over and above the normal amount that is expected in a production process.
The exchange or trade-in of a long-term asset for a completely different long-term asset. For example, exchanging an antique car for land.
A fee for the printing of checks ordered by a company. Often the amount is deducted automatically from a company’s checking account by the company that printed the checks.
These pronouncements were issued by the Committee on Accounting Procedures of the American Institute of Certified Public Accountants during the years 1953 to 1959. They were and are part of the generally accepted...
The time from when goods are ordered until the time when the goods are received.
The net amount of gross sales on credit minus the sales returns, sales allowances, and sales discounts which pertain to the sales on credit.
In accounting and bookkeeping this term is used to describe paying a vendor more than once for the amount owed.
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