See certified public accountant.
See certified public accountant.
A term that is sometimes used interchangeably with gross profit. Others use the term to mean the percentage of gross profit dollars divided by net sales dollars.
Costs that have been used up or consumed. Expired costs are reported as expenses. (Costs that have not yet expired are reported as assets.)
Approximate amounts. Accountants use estimates for depreciation expense, warranty expense, bad debts expense, monthly accruals for utilities, bonuses, income taxes, etc. Also see change in accounting estimate.
The amount before deductions. For example, gross pay is the amount before withholding deductions. Gross sales is the amount before sales returns and allowances and sales discounts.
Savings accounts and certificates of deposits at a bank.
A lien on real estate to protect a lender. The loan made with such security is referred to as a mortgage loan.
Actions taken or not taken prior to issuing financial statements in order to improve the amounts appearing in the financial statements.
The party receiving goods to be sold. See consigned goods.
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...
See freight-in.
The estimated volume in a future period that will be used for allocating indirect manufacturing costs.
See inventory conformity rule.
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...
The day after the record date for a cash dividend on shares of stock. Theoretically, the market price of the stock should drop on this day by the amount of the dividend.
The symbol that represents the total cost in the equation of the cost line y = a + bx.
A journal entry to correct an erroneous amount previously entered in the general ledger.
What is illusory profit? Illusory profit, also called phantom profit, is the difference between 1) the profit reported using historical costs required by US GAAP, and 2) the profit computed using replacement costs....
In accounting and bookkeeping this term is used to describe paying a vendor more than once for the amount owed.
One component of financial statement analysis. This method involves financial statements reporting amounts for several years. The earliest year presented is designated as the base year and the subsequent years are...
The current asset that represents the amount of interest revenue that was reported as earned, but has not yet been received.
Expenses that vary with some activity. For example, sales commissions expense and cost of goods sold will be greater when sales are greater; electricity expense will decrease when machine hours are reduced.
The term used by manufacturers to indicate that the manufacturing overhead applied or assigned to its production is greater than the amount actually incurred.
See accrual-type adjusting entry.
Expenses which do not change in response to reasonable changes in sales or other activity.
See functional and natural matrix.
Cash that can be used only for the purpose intended.
Goods or services provided instead of money.
See chief executive officer.
The abbreviation for the accounting and bookkeeping term debit.
The increase in a carrying amount. Also see write-up work.
The amount that a bank commits to lend a borrower during a specified purpose.
The Certified Management Accountant (CMA) Exam is a 13-hour, four-part exam on business analysis, management accounting and reporting, strategic management, and business application. The exam is administered through IMA,...
A detailed plan with dollar amounts. Examples of budgets used in business include the cash budget, sales budget, production budget, department budgets, the master budget, and the capital expenditures budget. Some budgets...
One of the cost flow assumptions associated with the periodic inventory system. The latest (recent) costs of goods purchased are removed from inventory first and are charged to the income statement as cost of goods sold....
The depreciation computed for financial reporting purposes—as opposed to income tax depreciation. To learn more, see Explanation of Depreciation.
See chief financial officer.
The difference in total revenues between alternative actions or plans.
See incremental cost.
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