FABM ENDTERM Flashcards
defined in accounting as any increase in capital other67y\
han the owners’ initial or further contributions.
Income
which provides for a
constructive receipt of income.
National Internal Revenue Code (NIRC)
is the process by which the government collects revenue in order to pay for its
expenses.
taxation
It is a process or means by which the sovereign, through its law-making body,
raises income to defray the necessary expenses of government.
taxation
are imposed in every country, mostly to fund government spending.
Taxes
is a body of rules under which a public authority has a claim on taxpayers, requiring them to transfer to the authority part of their income or property. T
tax law
the imposition of taxes on the income of individuals derived from
compensation, business trade, self-employed, or practice of a profession or from
property less deductions authorized by the law.
Income taxes
not dependent upon the will of the taxpayer.
Enforced contributions
Congress makes tax laws
Imposed by legislative body-
– The ability to pay principle is the basic rule in collecting taxes.
Those who earn more contribute to the government’s coffer more than those with lesser
earnings.
Proportionate in character
money is the preferred payment of taxes. If property is
taken to satisfy tax liability, it is sold through public auction to satisfy the tax obligation.
Payable in the form of money –
taxes are the primary source of government
revenue
. Imposed for the purpose of raising revenue –
money is taken from the public and returned to them in the form
of public benefits.
. Used for public purpose –
a Filipino citizen who lives or resides here in
the Philippines
Resident citizen
citizen to a foreign country and does not
reside in the Philippines
A non- resident
citizen
a citizen of another foreign country but
resides in the Philippines
Resident Alien
Non-VAT registered businesses are required to pay a 3% of
gross sales or receipts
Percentage taxes
It is a record of the bank’s client set up by the bank.
BANK ACCOUNT
– It refers to the money placed in a bank or other financial
institution for safekeeping.
Savings Account
– It is also referred to as a current account.
Checking Account
It is also known as a deposit certificate.
Time Deposit –
It is a bank document used by a bank client or depositor if
he/she wants to put money in the bank for safekeeping.
DEPOSIT SLIP –
It is a bank document that a bank customer uses to
withdraw or receive cash from his or her bank account
WITHDRAWAL SLIP
It is a payment instrument issued by a person to cover the cost of goods
and services.
CHECK –
This is a written order instructing a person’s bank to pay a specific
amount of money to be drawn against the person’s checking account in exchange
for the bank’s certification that the person’s signature on the check is genuine
and that the person has sufficient funds in his or her checking account to cover
the amount.
CHECK
A check wherein the issue date or date or the date of check is past six months or one hundred eighty days or more is considered as
stale check
a check dated at a future date is considered a
post-dated check
person or entity who makes the check
Drawer
the bank or other financial institution where the check can be
presented for payment.
Drawee,
It is a schedule prepared by the company to bring the depositor’s cash balance and the related bank’s cash balance into agreement.
Bank reconciliation
It shows the items causing the
discrepancies between the balance per bank and balance per book
Bank reconciliation
– It is a monthly report released by the bank to the account holder of
the checking account.
Bank Statement
This method simply adjusts the
unadjusted balance per book.
Unadjusted Bank to Book Balance Method
– This method simply adjusts the
unadjusted balance per book in order to arrive at the unadjusted balance per
bank.
Unadjusted Book to Bank Balance Method
This method adjusts both balances to the corrected
cash balance that will be presented in the balance sheet
Adjusted Balance Method
These are deposits already recorded in the company’s
books thereby increasing the cash balance but not yet recorded in the bank
record
Deposit in transit
– These are checks issued by the company but not yet paid
by the bank
Outstanding checks
These are items erroneously recorded by the ban
Bank errors
– These are deposits made by the bank in the company’s account
but not yet reflected in the books or company’s records
Bank credits
These are charges made by the bank against the company’s
account but not yet reflected in the company’s records.
Bank Debits
Examples: Collection of
Customers, Proceeds from Loan, Interest Income
Bank Credits
Examples: NSF Checks,
Service Charges such as for checkbook printing
Bank debits
It is considered as the book of original entry where the accountant debits and credits
the correct account in the journal and enters the transaction for the first time in the
books of accounts using the double-entry procedure
journal
These are original entry columnar books used to
record comparable transactions.
Special Journal –
keeps track of all
transactions involving cash inflows. I
Cash Receipts Journal
It is a special journal where all transactions
involving outflows or payment of cash are being recorded.
Cash Disbursement Journal –
- All sales transactions on account or with a promissory note
are recorded in the
Sales Journal
-It is a special journal that is intended to keep track of
any product that has been purchased on credit.
Purchase Journal
Transactions that cannot be recorded in the special
journals are recorded in the
General Journal -
It is considered as the books of final entry.
ledger
sometimes known as a nominal ledger
General Ledger
is a bookkeeping ledger where accounting data from journals and subledgers
such as accounts payable, accounts receivable, cash management, fixed
assets, purchasing, and projects is posted.
General Ledger
stores the details for a general
ledger control account.
Subsidiary Ledger
is a type of document that contains information related to a
transaction
A business form
It provides details such as the date of the transaction, the items
bought or sold, and the name of the buyer and seller.
Business Forms
These forms are being used for the internal transactions of the business.
Internal business forms
. These
forms document the personnel’s accountability for the transactions that have
occurred.
Internal busines forms
– It is an internal document filled out if there are any
items that any of the department
wants to purchase
Purchase requestion
– It is a business form that is being used to document
the quantity and quality of the items received by the personnel from the
seller.
Receiving report
This form documents the process for the preparation,
verification, and authorization of
check payments of the company’s
payables.
check voucher
These forms are issued or given mainly to parties outside the business as proof
of a transaction done with the company.
External Business forms
– It is a document to
communicate the buyer’s exact order to
the supplier.
Purchase order
It is a form being prepared by the seller to document the
delivery of the items ordered.
Delivery receipt
It is a document that
shows the exact amount of
payment that is being asked by the
seller to the buyer based on the
items delivered and the agreed
price.
Sales Invoice
It is a
form prepared by the seller
and submitted to the buyer.
Statement of Account or
Billing Statement
It is issued in payment of assets
Cash
A monthly report released by the bank
Bank statement
It is the schedule prepared to brings the depositor’s cash
Bank reconciliation
It is a tax laid upon the privilege of engaging in business or pursuing an occupation, calling, or
profession.
Business tax
It is the VAT on sales transactions.
Output Vat
. It is the amount of money coming to a person or corporation within a specified time, whether as payment
for services, interest, or profits from investment
Income
. It is a business tax imposed on persons or entities who sell or lease goods, properties or
services in the course of trade or business whose gross annual sales or receipts do not exceed P3,000,000
and are not VAT-registered.
Percentage Tax
the recipient of the money
payee
