Glossary

Question 1

Define Accounts Payable

Answer 1

Amounts owing by the company for services rendered by the creditor

Also for Good’s Sold that have not been paid for and are due now or in the future

Question 2

Define Accounts Receivable

Answer 2

Amounts owing to a company for services rendered

Also for Good’s sold that have not been paid for and are due now or in the future

Question 3

Define Accrued Expenses

Answer 3

An estimated liability of an entity that is not yet due

Question 4

Define Amortization

Answer 4

The systemic Expensing of a portion of the cost of intangible capital assets in such a manner as to match the expenses with the revenue of the period

Question 5

Define Assets

Answer 5

Good’s Owned by the business for the purposes of earning income

Question 6

Define Balance sheet

Answer 6

A statement that lists all the assets, liabilities and owners equity of a business

Question 7

Define Bank Reconciliation

Answer 7

A calculation that matches the balance in the bank account to the bank account in the books.

Question 8

Define Capital Assets

Answer 8

Assets that are owned by the business for the purposes of earning income.

These are not intended for sale, and expected to be continuing used

Question 9

Define Costs of Goods sold

Answer 9

Represents the cost of inventory actually sold to the customers in the statement period

Question 10

Define Cross-added

Answer 10

The process of adding all debit columns in a ledger or journal

Question 11

Define Depreciation

Answer 11

The systemic expensing of a portion of the cost of tangible capital assets in such a manner as to match the expenses with the revenue of the period.

Question 12

Define F.O.B

Answer 12

Free on Board

Question 13

Define Fiscal Year

Answer 13

The Company’s year end

Question 14

Define GST

Answer 14

Goods and Services Tax

Question 15

Define Gross Margin

Answer 15

it’s the difference between sales and costs of goods sold during a given period

Question 16

Define Income Statement

Answer 16

lists all the revenue and expenses to arrive at a net income (Loss) for the period

Question 17

Define Intangible Assets

Answer 17

Assets that have no physical form or structure

Question 18

Define Journals

Answer 18

Books of original entry that record transactions

Question 19

Define Ledgers

Answer 19

a book that lists individual accounts in a way to accumulate a total of the balance in that account

Question 20

Define Liabilities

Answer 20

to pay for current and past transactions

Question 21

Define Long-Term Debt

Answer 21

Amounts owing by an entity are payable according to the terms of the agreement at some future date

Question 22

Define Mortgage

Answer 22

A loan that is secured by real estate

Question 23

Define NBV

Answer 23

Net Book Value

Question 24

Define 2/10 n/30

Answer 24

it is used with a reason for the term such as 2/10, n/30 days. This means the company can take a discount of 2% on the invoice amount if the invoice is paid in full within 10 days of the invoice date. Otherwise, the total amount is due in 30 days.

Question 25

Define PST

Answer 25

Provincial Sales Tax,

Question 26

Define Percent

Answer 26

An amount expressed per 100

Question 27

Define Posting

Answer 27

when an entry in one book is transferred to another location

Question 28

Define Residual Balance

Answer 28

The Balance of the original cost of a capital asset

Question 29

Define Retained Earnings

Answer 29

The Excess of Revenue over all expenses of a company that have not been paid out

Question 30

Define Round or Rounding

Answer 30

the process of eliminating cents in a financial report

Question 31

Define Share Capital

Answer 31

Funds invested in a corporation as permanent capital

Question 32

Define Tangible Assets

Answer 32

Assets that have a physical form or structure. Examples are land and equipment.

Question 33

Define Trial Balance

Answer 33

A listing of debit and credit items from ledgers in columns, to see that the total debits equal the total credits.