Accounting 1: Chapter 5

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straightupdeme
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40465
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Accounting 1: Chapter 5
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2010-10-07 11:26:33
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Accounting Chapter
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Accounting 1: Chapter 5
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  1. Administrative Expenses
    expenses relating to general operating activities such as personnel management, accounting, and store security
  2. Contra-Revenue Account
    an account that is offset against a revenue account on the income statement
  3. Cost of Goods Sold
    the total cost of merchandise sold during the period
  4. FOB Destination
    freight terms indicating that the seller places the goods free on board to the buyer's place of business, and the seller pays the freight
  5. FOB Shipping Point
    freight terms indicating that the seller places goods free on board the carrier, and the buyer pays the freight costs
  6. Gross Profit
    the excess of net sales over the cost of goods sold
  7. Gross Profit Rate
    gross profit expressed as a percentage, by dividing the amount of gross profit by net sales
  8. Income from Operations
    income from a company's principal operating activity; determined by subtracting cost of goods sold and operating expenses from net sales
  9. Multiple-Step Income Statement
    an income statement that shows several steps in determining net income
  10. Net Sales
    sales less sales returns and allowances and less sales discounts
  11. Nonoperating Activities
    various revenues, expenses, gains, and losses that are unrelated to a company's main line of operations
  12. Operating Expenses
    expenses incurred in the process of earning sales revenues
  13. Other expenses and losses
    a nonoperating-activities section of the income statement that shows expenses from auxiliary operations and losses unrelated to the company's operations
  14. Other revenues and gains
    a nonoperating-activities section of the income statement that shows revenues from auxiliary operations and gains unrelated to the company's operations
  15. Periodic Inventory System
    an inventory system under which the company does not keep detailed inventory records throughout the accounting period but determines the cost of goods sold only at the end of an accounting period
  16. Perpetual Inventory System
    an inventory system under which the company keeps detailed records of the cost of each inventory purchase and sale and the records continuously show the inventory that should be on hand
  17. Purchase Allowance
    a deduction made to the selling price of merchandise, granted by the seller so that the buyer will keep the merchandise
  18. Purchase Discount
    a cash discount claimed by a buyer for prompt payment of a balance due
  19. Purchase Invoice
    a document that supports each credit purchase
  20. Purchase Return
    a return of goods from the buyer to the seller for a cash or credit refund
  21. Sales Discount
    a reduction given by a seller for prompt payment of credit sale
  22. Sales Invoice
    a document that supports each credit sale
  23. Sales Returns and Allowances
    purchase returns and allowances from the seller's perspective
  24. Sales Revenue (Sales)
    the primary source of revenue in a merchandising company
  25. Selling Expenses
    expenses associated with making sales
  26. Single-Step Income Statement
    an income statement that shows only one step in determining net income

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