Law & Business Flashcards
Account
A separate record of an asset, liability, income, or expense of a business
Accounting
The process for recording, summarizing, and interpreting business financial records
Accounting Method
The method of recording income and expenses for a business, can be either accrual method or cash method
Accounting System
The specific system of record-keeping used to set up the accounting records of a business. See also single-entry accounting or double-entry accounting
Accounts Payable
Money owed by a business to another for goods or services purchased on credit. Money that the business intends to pay to another
Accounts Receivable
Money owed to the business by another for goods or services sold on credit. Money that the business expects to receive
Accrual Method
Accounting method in which all income and expenses are counted when earned or incurred regardless of when the actual cash is received or paid
Accrued Expenses
Expenses that have been incurred but have not yet been paid
Accrued Income
Income that has been earned but has not yet been received
Agent
A person who is authorized to act on behalf of another. A corporation acts only through its agents, whether they are directors, employees or officers
Aging
The method used to determine how long accounts receivable have been owed to a business
Amend
To alter or change
Articles of Incorporation
The charter of the corporation, the public filing with a state that requests that the corporation be allowed to exist. Along with the corporate bylaws, they provide details of the organization and structure of the business. They must be consistent with the laws of the state of incorporation
Assets
Everything a business owns, including amounts of money that are owed to the business
Assumed Name
A name, other than the corporation’s legal name as shown on the Articles of Incorporation, under which a corporation will conduct business. Most states require registration of the fictitious name if a company desires to conduct business under an assumed name. The corporation’s legal name is not an assumed name.
Authorized Stock
The number of shares of stock that a corporation is allowed to issue as stated in the Articles of Incorporation. All authorized shares need not be issued
Balance Sheet
The business financial statement that depict the financial status of the business on a specific date by summarizing the assets and liabilities of the business
Balance Sheet Accounts
Asset and liability accounts used to prepare business balance sheets
Board of Directors
The group with control of the general supervision of the corporation. They are elected by the shareholders and the directors, in turn, appoint the officers of the corporation
Bookkeeping
The actual process of recording the figures in accounting records. Business corporation laws: For each individual state, these provide the legal framework for the operation of corporations. The Articles of Incorporation and the Bylaws of a corporation must adhere to the specifics of state law.
Business Liabilities
Business debts. Also the value of the owner’s equity in his or her business
Bylaws
The internal rules that govern the management of the corporation. They contain the procedures for holding meeting, appointments, elections and other management matters. If these conflict with the Articles of Incorporation, the provision in the Articles will be controlling.
C-corporation
A business entity owned by shareholders that is not an S-corporation. Subject to double taxation, unlike S-corporations
Calendar Year
Year consisting on 12 consecutive months ending on December 31st.