Assets other than cash, accounts receivables, and notes receivables. Holders of nonmonetary assets could avoid holding losses during periods of inflation.
Assets other than cash, accounts receivables, and notes receivables. Holders of nonmonetary assets could avoid holding losses during periods of inflation.
See Accounting Research Bulletin.
In business decision-making, payback means the number of years before the cash invested in a project is returned. It involves the cash flows from the project but generally the cash flows are not discounted to reflect the...
A bearer bond is a bond that is not registered in its owner’s name. The person holding the bond is presumed to be the owner of the bond. The interest on a bearer bond is received by clipping one of the dated...
Another company that supplies goods or performs services. Also known as a vendor.
The combination of a manufacturer’s direct labor and factory overhead.
The combination of direct materials and direct labor.
A Latin term that means in proportion. See prorate.
A journal entry to correct an erroneous amount previously entered in the general ledger.
The underlying true cause of a cost occurring. In other words, the root cause is more than a mere correlation between an event and a cost. There is a real cause and effect relationship.
Sometimes used as a heading in place of paid-in capital.
See chief financial officer.
See return on capital employed.
Using debt in order to control more assets. Also known as financial leverage.
The person or organization to whom a check is written.
See first-in, still here (FISH).
The amount of wages and related expenses that have been incurred by the employer (and earned by the employees) but have not yet been paid.
Also referred to as a sunk cost. A past cost is not relevant to a decision.
The quantity on hand that will trigger an order to buy more items. A company’s reorder point for Product X might be 80 units. When the quantity on hand gets down to 80, a purchase order is prepared to obtain more...
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...
A method where only the variable manufacturing costs are assigned to inventory and the cost of goods sold. Fixed manufacturing costs are viewed as expenses of the period in which they are incurred. This method is not...
See inventory conformity rule.
To repurchase bonds that the company had previously issued.
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...
A donor-imposed restriction on net assets that requires using the assets within a specified passage of time.
A division or department of a business whose managers are responsible for both revenues and expenses.
What is a debenture? A debenture is an unsecured bond. In other words, a debenture is a bond without a lien on specific assets owned by the issuing corporation. Join PRO to Track Progress Mark the Question as Read...
See long-term liabilities.
See inventory: work-in-process (WIP).
The person or business that receives a loan from a bank or other lender.
A potential gain that is not recognized by accountants in the financial statements until it actually occurs. For example, Company P is suing Company D over a patent infringement. Company P has a contingent gain. Because...
What is the difference between biweekly and semimonthly payroll? Definition of Biweekly Payroll Biweekly payroll refers to paydays that occur 26 times per year (52 weeks in a year divided by 2 weeks = 26 times per year)....
A quality of accounting information that facilitates the comparison of financial reporting of one company to the financial reporting of another company.
A technique using simultaneous equations to allocate a manufacturer’s service departments’ costs to both other service departments and to production departments.
The statistic known as the coefficient of correlation. The range of this statistic is -1 to +1. When this statistic is squared the result is the percentage change in the dependent variable y that is explained by the...
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.
See Internal Revenue Service (IRS).
A written opinion of an independent certified public accountant that a company’s financial statements are a fair representation of the company’s financial performance and financial position. The...
What is the debt to total assets ratio? Definition of Debt to Total Assets Ratio The debt to total assets ratio is an indicator of a company’s financial leverage. It tells you the percentage of a company’s total...
See last in, first out (LIFO).
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