Chapter 5 Flashcards
accounting system
The methods and procedures for collecting, classifying, summarizing, and reporting a business’s financial and operating information.
internal controls
The policies and procedures that protect assets from misuse, ensure that business information is accurate, and ensure that laws and regulations are being followed.
subsidiary ledger
A large number of individual accounts with a common characteristic can be grouped together in a separate ledger.
general ledger
The primary ledger, which contains all of the balance sheet and income statement accounts.
controlling account
A summarizing account that represents each subsidiary ledger in the general ledger.
accounts receivable subsidiary ledger
Also known as customers ledger. Lists the individual customer accounts in alphabetical order.
accounts payable subsidiary ledger
Also known as creditors ledger. Lists individual creditor accounts in alphabetical order.
special journals
Journals designed to record a single kind of transaction that occurs frequently.
revenue journal
Where fees earned on account would be recorded.
invoice
The bill that is sent to the customer by the company.
cash receipts journal
Where all transactions that involve the receipt of cash are recorded.
purchases journal
Where all purchases on account are recorded.
cash payments journal
Where all transactions involving the payment of cash are recorded.
supply chain management (SCM)
Internet application to plan supply needs and coordinate them with supplies.
customer relationship management (CRM)
Internet applications to plan and coordinate marketing and sales effort.
