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Bus 1010 Vocab > Bus 1010 chapter 14 > Flashcards

Bus 1010 chapter 14 Flashcards

1
Q

Accounting

A

Comprehensive system for collecting, analyzing, and communicating financial information.

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2
Q

Bookeeping

A

Recording of accounting transactions.

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3
Q

Accounting Information System (AIS)

A

Organized procedure for identifying, measuring, recording, and retaining financial information for use in accounting statements and management reports.

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4
Q

Controller

A

Person who manages all of a firm’s accounting activities (chief accounting officer).

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5
Q

Financial Accounting

A

Field of accounting concerned with external users of a company’s financial information.

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6
Q

Managerial (management) accounting

A

field of accounting that serves internal users of a company’s financial information.

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7
Q

Certified Public Accountant (CPA)

A

accountant licensed by the state and offering services to the public.

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8
Q

Audit

A

systematic examination of a company’s accounting system to determine whether its financial reports reliably represent its operations.

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9
Q

Generally Accepted Accounting Principles (GAAP)

A

Accounting guidelines that govern the content and form of financial reports.

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10
Q

Tax Services

A

Assistance provided by CPAs for tax preparation and tax planning.

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11
Q

Management advisory services

A

assistance provided by CPA firms in areas such as financial planning, information systems design, and other areas of concern for client firms.

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12
Q

Core Competencies for Accounting

A

The combination of skills, technology, and knowledge that will be necessary for the future CPA.

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13
Q

Private Accountant

A

Salaried accountant hired by a business to carry out its day-to-day financial activities.

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14
Q

Management Accountant

A

Private accountant who provides financial services to support managers in various business activities within a firm.

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15
Q

Certified Management Accountant (CMA)

A

Professional designation awarded by the Institute of Management Accountants in recognition of management accounting qualifications.

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16
Q

Forensic Accounting

A

the practice of accounting for legal purposes.

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17
Q

Certified Fraud Examiner (CFE)

A

Professional designation administered by the Association of Certified Fraud Examiners in recognition of qualifications for a specialty area within forensic accounting.

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18
Q

Sarbanes-Oxley Act of 2002 (Sarbox or Sox)

A

Enactment of federal regulations to restore public trust in accounting practices by imposing new requirements on financial activities in publicly traded corporations.

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19
Q

Accounting Equation

A

Assets=Liabilities + Owner’s Equity; used by accountants to balance data for the firm’s financial transactions at various points in the year.

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20
Q

Asset

A

Any economic resource expected to benefit a firm or an individual who owns it.

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21
Q

Liability

A

Debt owed by a firm to an outside organization or individual.

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22
Q

Owners’ Equity

A

Amount of money that owners would receive if they sold all of a firm’s assets and paid all of its liabilities.

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23
Q

Financial Statement

A

any of several types of reports summarizing a company’s financial status to stakeholders and to aid in managerial decision making.

24
Q

Balance Sheet

A

Financial statement that supplies detailed information about a firm’s assets, liabilities, and owners’ equity.

25
Q

Current Asset

A

Asset that can or will be converted into cash within a year.

26
Q

Liquidity

A

Ease with which an asset can be converted into cash.

27
Q

Fixed Asset

A

Asset with long-term use or value, such as land, buildings, and equipment.

28
Q

Depreciation

A

Accounting method for distributing the cost of an asset over its useful life.

29
Q

Intangible Asset

A

Nonphysical asset, such as a patent or trademark, that has economic value in the form of expected benefit.

30
Q

Goodwill

A

Amount paid for an existing business above the value of its other assets.

31
Q

Current Liability

A

Debt that must be paid within one year.

32
Q

Accounts Payable (Payables)

A

Current liabilities consisting of bills owed to suppliers, plus wages and taxes due within the coming year.

33
Q

Long-term Liability

A

Debt that is not due for at least one year.

34
Q

Paid-In Capital

A

Money that is invested in a company by its owners.

35
Q

Retained Earnings

A

Earnings retained by a firm for its use rather than paid out as dividends.

36
Q

Income Statement (Profit-and-Loss Statement)

A

Financial statement listing a firm’s annual revenues and expenses so that a bottom line shows annual profit or loss.

37
Q

Revenues

A

Funds that flow into a business from the sale of good or services.

38
Q

Cost of Revenues

A

Costs that a company incurs to obtain revenues from other companies.

39
Q

Cost of Goods Sold

A

Costs of obtaining materials for making the products sold by a firm during the year.

40
Q

Gross Profit

A

Preliminary, quick-to-calculate profit figure calculated from the firm’s revenues minus its cost of revenues (the direct costs of getting the revenues).

41
Q

Operating Expenses

A

Costs, other than the cost of revenues, incurred in producing a good or service.

42
Q

Operating Income

A

Gross profit minus operating expenses.

43
Q

Net Income (Net Profit, Net Earnings)

A

Gross profit minus operating expenses and income taxes.

44
Q

Statement of Cash Flows

A

Financial statement describing a firm’s yearly cash receipts an cash payments.

45
Q

Budget

A

Detailed statement of estimated receipts and expenditures for a future period of time.

46
Q

Revenue Recognition

A

Formal recording and reporting of revenues at the appropriate time.

47
Q

Full Disclosure

A

Guideline that financial statements should not include just numbers but should also furnish management’s interpretations and explanations of those numbers.

48
Q

Solvency Ratio

A

Financial ratio, either short-or long-term, for estimating the borrower’s ability to repay debt.

49
Q

Profitability Ratio

A

Financial ratio for measuring a firm’s potential earnings.

50
Q

Activity Ratio

A

Financial ratio for evaluating management’s efficiency in using a firm’s assets.

51
Q

Short-term Solvency Ratio

A

Financial ratio for measuring a company’s ability to pay immediate debts.

52
Q

Current Ratio

A

Financial ratio for measuring a company’s ability to pay current debts out of current assets.

53
Q

Debt

A

Company’s total liabilities.

54
Q

Leverage

A

Ability to finance an investment through borrowed funds.

55
Q

Earnings per Share

A

Profitability ratio measuring the net profit that the company earns for each share of outstanding stock.

56
Q

Code of Profesional Conduct

A

Code of ethics for CPAs as maintained and enforced by the AICPA.

57
Q

International Accounting Standards Board (IASB)

A

Organization responsible for developing a set of global accounting standards and for gaining implementation of those standards.

Bus 1010 Vocab (5 decks)

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