Preferred stock where the dividend could be more than the original, stated dividend.
Preferred stock where the dividend could be more than the original, stated dividend.
The inability to pay liabilities as they become due. Some consider a company to be insolvent when its current liabilities exceed its current assets.
A structured market for trading stocks and bonds such as the New York Stock Exchange or NASDAQ. Capital market can also include less structured markets such as private placements.
A term to mean the company’s general ledger or accounting records.
The method of accounting for treasury stock whereby the cost of the stock that is repurchased by the issuing corporation is recorded and is reported in the contra stockholders’ equity account Treasury Stock.
See direct labor efficiency variance.
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.
Manufactured products that are often expressed in units, machine hours, etc.
The amount received from the sale of an asset, from the issuance of bonds or stock, or from a bank loan.
In activity-based costing, this refers to the number of items that will be produced after a machine has been setup.
A legal entity organized under state laws that is considered separate from its owners. Ownership is evidenced by shares of stock.
The actual cost incurred for manufacturing costs other than direct materials and direct labor which increase as production volume increases. Examples include manufacturing supplies and electricity to operate the...
The income statement account which contains a portion of the cost of equipment that is being expensed during the time interval shown in the heading of the income statement.
A parody of FIFO used to describe a very slow-moving item in inventory.
See direct labor rate variance.
A current asset account that represents an amount of cash for making small disbursements for postage due, supplies, etc.
An employee fringe benefit provided by an employer that allows employees to be absent from work with pay. Often the number of paid vacation days allowed is based on the number of years of employment.
A bank or investment account with a fluctuating interest rate. Usually the funds can be withdrawn on demand, even though the account is not a checking account.
See our Break-even Point Outline.
A current asset account that reports the amount of future rent expense that was paid in advance of the rental period. The amount reported on the balance sheet is the amount that has not yet been used or expired as of the...
The reduction of an asset’s carrying amount. For example, we often reduce or write down inventory from its cost to its net realizable value when the net realizable value is lower.
The borrower who provides to a lender an asset as collateral for a loan.
The result of the sale of an asset for less than its carrying amount; the write-down of assets; the net result of expenses exceeding revenues.
A long-term asset account reported on the balance sheet under the heading of property, plant, and equipment. Included in this account would be copiers, computers, printers, fax machines, etc.
A financial statement that reported the changes in a company’s working capital. The funds flow statement has been replaced by the statement of cash flows.
The chief accounting officer of a company. This person would head up the accounting department.
Bookkeeping Video Training Part 7 Adjusting entries: deferred revenues, accrued revenues, reversing accruals to avoid double-counting Must-Watch Video Learn How to Advance Your Accounting and Bookkeeping Career Perform...
An expense account which is expected to have a credit balance instead of the typical debit balance.
See sum-of-the-years’ digits method of depreciation.
A form used at a bank to inform its customer that the customer’s account is being reduced for a fee or other charge.
A corporation’s own stock that has been repurchased from stockholders. Also a stockholders’ equity account that usually reports the cost of the stock that has been repurchased.
One of the types of donor-imposed temporary restrictions. An example of a purpose restriction is a cash donation with a donor-imposed requirement that the money be used only to purchase a vehicle for one of its programs....
Sometimes referred to in the context of cost or expense behavior such as “variable expenses increase as volume increases.” In this context volume might be an activity such as the number of machine hours, the...
An organization without owners and with the main purpose of providing services needed by society. After application and approval by the U.S. Internal Revenue Service, a nonprofit organization may be granted tax exempt...
An asset’s cost that has been assigned to Depreciation Expense.
The debit or credit balance that would be expected in a specific account in the general ledger. For example, asset accounts and expense accounts normally have debit balances. Revenues, liabilities, and...
One hundredth (1/100) of a percentage point. In other words, one percentage point is equal to 100 basis points. The difference between an interest rate of 6.5% and 6.75% is 25 basis points.
A budget that flexes with volume. Under a flexible budget the budgeted amount of manufacturing overhead will increase if the company produces more units than planned. The flexible budget will decrease if the company...
The rate that will discount all cash flows to a net present value of zero.
The combined federal and state income tax rate that applies to an additional amount of taxable income.
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