See inventory: finished goods (FG).
See inventory: finished goods (FG).
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.
A balance on the right side (credit side) of an account in the general ledger.
A stated legal amount often appearing on preferred stock, bonds, and some common stock.
An amount that is expensed immediately. For example, routine repair costs on equipment are revenue expenditures because they are charged directly to an income statement account such as Repairs and Maintenance Expense.
The amount of rent that has been earned by the landlord or owner during the accounting period shown in the heading of the income statement, but it has not been received as of the last day of the accounting period.
A department that is directly involved in manufacturing products. Examples are the machining, finishing, and assembling departments.
A liability account in a bank’s general ledger that indicates the amounts owed to bank customers for the balances in the customers’ individual checking, savings, and certificate of deposit accounts.
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...
Recording an entry in an account in the general ledger or in a subsidiary ledger.
Using debt (such as loans and bonds) to acquire more assets than would be possible by using only owners’ funds. Also referred to as trading on equity.
To repurchase bonds that the company had previously issued.
A lease where the lessee/tenant pays not only rent, but also the property taxes, insurance, and maintenance.
A formal written promise to pay interest every six months and the principal amount at maturity.
A lender such as a bank who has placed a lien on a borrower’s assets. As a result, the lender has collateral until the loan amount is repaid.
Usually the top ranking officer of the corporation who is charged with executing the policies set by the board of directors.
Within a reasonable range of activity, the slope of the cost line is the variable rate, which is often denoted as ‘b’ in the straight line y = a + bx.
Preferred stock that can be exchanged by the holder for a specified number of shares of common stock of the same company.
Inventory that is less than the expected amount. It might be associated with theft or damage.
The amount of office supplies used during a specified time interval.
Federal government securities with a fixed interest rate and maturing in more than 10 years.
The difference between the call price of a bond or preferred stock and its stated or par value.
The sale of the accounts receivable (usually for a fee) to a third party known as a factor.
The result of subtracting all variable expenses from revenues. It indicates the amount available from sales to cover the fixed expenses and profit.
The amount of an asset’s cost that will be depreciated. It is the cost minus the expected salvage value. For example, if equipment has a cost of $30,000 but is expected to have a salvage value of $3,000 then the...
A request by the petty cash custodian for a company check in order to return the amount of currency and coins in the petty cash box to the amount shown in the general ledger account.
The number of years needed to recover the cash amount invested in a project. The calculation uses cash flows rather than accounting income flows. Generally the cash flows are not discounted to reflect the time value of...
An owner’s equity account that reports the amount the sole proprietor invested in the company plus earnings of the company not withdrawn by the owner.
Future cash amounts that have not been discounted to their present value.
Generally a long term liability account containing the face amount, par amount, or maturity amount of the bonds issued by a company that are outstanding as of the balance sheet date. To learn more about bonds payable,...
Segments of a business. For example, a corporation may have a consumer division and an industrial division in order to improve its effectiveness in marketing its goods.
This classification of net assets has been replaced by the FASB with the classification net asset with donor restrictions.
A statistical tool that uses the least-squares method to estimate the fixed and variable components of mixed costs.
The gross purchases of merchandise for resale minus purchase returns, purchase allowances, and purchase discounts.
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...
Bonds with one maturity date (as opposed to serial bond).
The entry made in a journal. It will contain the date, the account name and amount to be debited, and the account name and amount to be credited. Each journal entry must have the dollars of debits equal to the dollars of...
The date a corporation pays a dividend to its shareholders. On this date the accounting entry will be a debit to Dividends Payable and a credit to Cash.
Noncurrent assets. Assets that are not intended to be turned into cash or be consumed within one year of the balance sheet date. Long-term assets include long-term investments, property, plant, equipment, intangible...
This term is usually associated with assets that are depreciated. In the month that an asset is acquired or disposed, it is assumed to have occurred in the middle of the month.
Featured Review
"As a seasoned bookkeeper and business owner with over 30 years of experience, I can confidently say that becoming a PRO user on the AccountingCoach website has transformed my approach to accounting. The materials offer unparalleled depth and clarity, perfectly aligning with my professional needs. The decision to upgrade was motivated by a quest for comprehensive resources, and the website has surpassed my expectations. The engaging content and practical examples have not only streamlined my workflow but also enriched my skill set, making intricate concepts more accessible. For anyone serious about excelling in accounting, this investment is truly worthwhile." - Theresa M.
Join PRO or PRO Plus and Get Lifetime Access to Our Premium Materials
Read all 2,645 reviews
For the past 52 years, Harold Averkamp (CPA, MBA) has
worked as an accounting supervisor, manager, consultant, university instructor, and innovator in teaching accounting online. He is the sole author of all the materials on AccountingCoach.com.
We now offer 10 Certificates of Achievement for Introductory Accounting and Bookkeeping: