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Account********
a device for recording the changes (increases or decreases) in the fundamental accounting elements
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Accountant
one who is concered with the design of the system of records, the preparation of reports based upon the recorded data, and the interpreation of the reports
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Accounting*******
a language of business employed to communicate financial information based upon analyzing, recording, classification, summariztion, reporting and interpretation of financial data
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Accounting equation
Assets equal Liabilities plus Owner's Equity
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Accounts payable*********
an unwritten promise by a customer to pay creditors for property, such as merchandise, supplies or equipment purchased on credit or for servics received on credit
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Accounts receivable*******
an unwritten promise by a customer to pay, at a later date, for goods sold or service rendered
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Analyzing******
determining the fundamental significance of business transactions so that financial information may be properly processed
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Assets*******
property of monetary value ownee by a business
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Auditing (verifying)
a complete testing and checking of all financial records of a business to be certain that acceptable policies and practices have been followed
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Balance sheet(statement of financial position; statement of financial condition)
a formal financial statement illustrating the assets, liabilities and owner's equity of a business as of a specific date
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Balance sheet common-size statements/percentage method
express the major items in the balance sheet as a percent of the total assets ane compare with previous fiscal periods
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Balance sheet comparative forms
record the balance sheet data for two or more comparable periods on the same form so that the information can be readily compared
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Bookkeeper (information processor0
one who is involved in the process of recording financial information in a prescribed manner
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budget
a formal written statement, which may be based upon adjusted historical data, of managmeent's plans for the future expressed in financial terms
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Capital
factors of production used to create goods or services that are not themselves significantly consumed (though they may depreciate) in the production process. Capital goods may be acquired with money or financial capital
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Certified Public Accountant/CPA
an individual possessing a college education, having practical experience in accounting and who has passed a comprehensive state examination in order to be certifid to practice public accounting in the state
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Classiying*********
the sorting of the many business transactions in an orderly and systematic manner; sorting or grouping like things together
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Drawing account (owner withdrawals)********
a separate owner's equity account in which withdrawls of cash or other assets by the owner for personal use are recorded
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Expense********
a decrease in assets, other than withdrawls by the owner, which results from efforts to produce revenues
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fiscal year********
any consecutive 12 month period
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Income statement(profit and loss statement; operating statement; statement of operation)
a formal financial statement which presents the income, expenses and resulting net profit or net loss for a given period
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interpreting**********
explaning the significant events or developments that occur, usually taking the form of analysis and comparisons
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liabilities*******
any debts that a business owns
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liquidity analysis
measures the ability of the firm to meet its current obligations
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mechandise
the commodities or goods that are bought and sold in business
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net income (net profit)*********
the difference between gross profit and expenses when gross profit is larger
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net loss**********
the difference between gross profit and expenses when expenses are larger
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net working capital
the excess of current assets over current liablities
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Notes payable****
a written promise to pay a creditor a certain amount in the future
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operating expenses (overhead)
expenses incurred in the normal operation of a business
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owner's equity (net worth; capital; proprietorship)************8
the amount by which the total assets exceed the total liabilities of a business; an owner's financial intrest in a business
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recording (data entry)***********
the commiting of a business transaction and the events surrounding such into writing
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statement of owner's equity (statement of net worth)
a formal financial statement which summarizes all of the changes in owner's equity during a specified period or time
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summarizing*****
bringing accounting data together in a way that will further enhance it's usefulness, usually by means of reports and statements; brinking together various items of information to determin or explain a result
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Accounting clerk
records, sorts and files accounting information
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Accounting information systems
accountants in this area design and implement manual and computerized accounting systems
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budgeting
the process in which accountants help managers develope a financial plan
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Certified Internal Auditor
an internal auditor who has achieved professional recognition by passing the uniform esamination offered by the inwtitute of Internal Auditors
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Certified Management Accountant
an accountant who passed an examination offered by the Institute of Management Accountants
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controller
the accountant who oversees the entire accounting process and is the principal accounting officer of a company
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corporation
a type of ownership structure in which stockholders own the business. The owners' risk is usually limited to their intitial investment, and they usually have very little influence on the business decisions.
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cost accounting
determining the cost of producing specific products or providing services and analysing for cost effectiveness
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discusion memorandum
the first document issued by FASB when developing an accounting standard. This document indentifies the pros and cons of various accounting treatments for an event.
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exposure draft
this document explains the rules that FASB believes firms should follow in accounting for a particular event. Based on the responses to the exposure draft, the Board will decide if any changes are necessary before issuing a final standard
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financial accounting
includes preparing various reports and financial statements and analyzing operating, investing and financing decisions
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general accepted accounting principles (GAAP)
Procedures and guidlines developed by the Financial Accounting Standards Board to be followed in the accounting and reporting process
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internal auditing
reviewing the operating and accounting control procedures adopted by management to make sure the controls are adequate and being followed; assuring that accurate and timely information is provided.
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interpreting*****
deciding the meaning and importance of the information in various reports
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management advisory services
providing advice to businesses on a wide variety of managerial issues
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manufacturing business
a business that makes a product to sell
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merchandising business
a business that buys products to sell
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para-accountant
a paraprofessional who provides many accounting, auditing, or tax services under the direct supervision of an accountant
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partnership
a type of ownership structure in which more than one person owns the business
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public hearing
following the issuance of a discussion memorandum, public meetings are often held by FASB to gather opionions on the accounting issue
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reporting
telling the results of the financial information
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Sarbanes-Oxley Act
An act passed by Congress to help improve reporting practices of public companies
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service business
a business that provides a service
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sole proprietorship****
a type of ownership structure in which one person owns the business
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statement of financial accounting standards
a standard issued by the Financial Accounting Standards Board. These standards must be followed when preparing financial statements
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tax accounting
services focused on tax planning, preparing tax returns, and dealing with the Internal Revenue Service and other governmental agencies
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taxation
- a. The act or practice of imposing taxes.
- b. The fact of being taxed.
- 2. An assessed amount of tax.
- 3. Revenue gained from taxes.
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account title****
provides a description of the particular type of asset, liability, owner's equity, revenue, or expense
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Accounting period concept
The concept that income determination can be made on a periodic basis
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business entity
an individual, association, or organization that engages in economic activities and controls specific economic resources
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business equity concept
the concept that nonbusiness assets and liabilities are not included in the business entity's accounting records
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business transactions
an economic event that has a direct impact on the business
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input
business transactions provide the necessary input for the accounting information system
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liquidity
a measure of the ease with which an asset will be converted to cash
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net worth
another term for owner's equity, the amount by which the business asserts exceed the business liabilities
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operating statement
another name for the income statement, which reports the profitability of business operations for a specific period of time.
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output
the financial statements are the output of the accounting information system
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processing
recognizing the effect of transactions on the assets, liabilities, owner's equity, revenues, and expenses of a business
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profit and loss statements
another name for the income statement, which reports the profiability of business operations for a specific period to time
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revenues*****
the amount a busines charges customers for products sold or services performed
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statement of financial condition
another name for the balance sheet, which reports assets, liabilities, and owner's equity on a specific date
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statement of financial position
another name for the balance sheet, which reports assets, liabilities and owner's equity on a specific date
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statement of owner's equity
reports beginning capital plus net income less withdrawls to compute ending capital
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Basic Accounting Equation*****
Be able to do transactions & identify the accounts that are affected & whether they increase or decrease
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Disbursement****
Money paid out; expenditures
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Phase in accounting process****
analyzing, recording, classifying, summaraizing, reporting, interpreting
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Transactions
is an economic event that has a direct impact on the business
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