Vocabulary- Accounting for Funeral Service Flashcards
1
Q
A federal act which requires most employers and employees to pay taxes to support the federal social security program.
A
Federal Insurance Contributions Act
2
Q
Property of a relatively permanent nature used in the operation of a business and not intended for resale.
A
Fixed Assets (Long Term Assets)
3
Q
Net income divided by net sales.
A
Profit Margin
4
Q
A source document showing quantity, description, prices of items, total amount of purchase and the terms of payment.
A
Invoice
5
Q
A journal designed to accumulate data about only one kind of business transaction.
A
Special Journal
6
Q
Property of monetary value owned by a business.
A
Assets
7
Q
The right side of a standard account.
A
Credit
8
Q
A total, written in small pencil figures, under the last entry in a column of an account.
A
Footing (Pencil Footing)
9
Q
A temporary owner’s equity contra account utilized to record the return of merchandise to the manufacturer or supplier as the result of material defects in workmanship and/or inferior product quality.
A
Purchases Returns and Allowances
10
Q
A formal financial statement which presents the income, expenses, and resulting net profit or net loss for a given period.
A
Income Statement
Profit and Loss Statement, Statement of Operations, Operating Statement
11
Q
A temporary owner’s equity contra account used to record discounts taken on inventory purchases; the amount of any discounts granted by suppliers to encourage prompt payment of their invoices.
A
Purchases Discount
12
Q
Accounts utilized to accumulate income, expenses, and owner’s withdrawals for one account period only.
A
Temporary Owner’s Equity Accounts
13
Q
A special ledger account which is used to keep track of unexplained shortages or overages of cash.
A
Cash Short and Over
14
Q
A condition in which the total of the debits and the total of the credits are equal in an account.
A
In Balance
15
Q
A twelve month period beginning January 1st and concluding on December 31st.
A
Calendar Year
16
Q
Any activity of a business enterprise that involves the exchange of values.
A
Transaction
17
Q
A business or individual to whom a debt is owed.
A
Creditor
18
Q
A source document that grants credit to a buyer for purchase return or purchase allowance.
A
Credit Memorandum
19
Q
Gross profit divided by net sales.
A
Gross Profit Percentage
20
Q
Cash or other assets that will be converted into cash or consumed within one year.
A
Current Assets
21
Q
A tax levied on the earnings of individuals and businesses by federal, state, and local governments.
A
Income Tax
22
Q
Income before any deductions have been made.
A
Gross Earnings (Gross Pay)
23
Q
A check dated subsequent to (following) its date of issuance.
A
Postdated Check
24
Q
A check drawn by a bank on its own funds and signed by an officer of the bank.
A
Cashiers Check
25
An expense incurred in operating a business during an accounting period, but not yet paid.
Accrued Expense
26
An accounting practice in which revenue is not recognized in the accounting records until received and which expenses are not recognized until paid.
Cash Basis Accounting
27
A process which examines each page of a journal, confirming that the debit entries equal the credit entries on each page.
Proving the Journal
28
Measures the ability of the form to meet its current obligations.
Liquidity Analysis
29
A person of concern, usually a bank, that has been ordered to make a payment on a check or draft.
Drawee
30
A form used to reflect payments from the petty cash fund.
Petty Cash Voucher
31
The process of entering the journal page number in the ledger and the ledger account number in the journal.
Cross Referencing
32
The face value of a promissory note upon which interest is computed.
Principal
33
The difference between to total debits and total credits in an account.
Account Balance
34
Entries made at the end of each reporting period to transfer the balances of the temporary owner's equity accounts to the permanent owner's equity account and to reduce the balance in the temporary owner's equity accounts to zero in preparation for the next accounting period.
Closing Entries
35
Employee's Withholding Allowance Certificate
W-4 Form
36
The process of communicating the results achieved during an accounting period to others.
Final Processing (Reporting)
37
A temporary owner's equity account used to record the buying of merchandise for resale.
Purchases
38
A language of business employed the communicate financial information based upon analyzing, recording, classification, summarization, reporting, and interpretation of financial data.
Accounting
39
Not Sufficient Funds
NSF
40
Liabilities that are not due and payable within one year.
Fixed Liabilities (Long Term Liabilities)
41
Provides evidence concerning the earnings potential of a company and how effectively the firm is being managed.
Profitability Analysis
42
Recording in each fiscal period applicable expenses, whether paid or not, an income earned, whether collected or not.
Accrual Accounting
43
Measures how efficiently a firm is utilizing its assets.
Activity Analysis
44
A work paper prepared after all temporary owner's equity accounts have been closed and all permanent accounts have been balanced and ruled, proving the equality of the debits and credits.
Post Closing Trial Balance
45
A work paper proving the equality of the debit and credit balance in the ledger.
Trial Balance
46
Funeral Unemployment Tax Act.
FUTA
47
A report sent to each customer, usually at the end of the month, which indicates the status of their account.
Statement of Account
48
A method of computing interest based on the assumption that there are 360 days in a year.
Banker's Method (360 Day Method)
49
A written promise of a customer to pay the business a sum of money at a future date.
Note Receivable
50
A formal financial statement illustrating the assets, liabilities, and owner's equity of a business as of a specific date.
Balance Sheets
| (Statement of Financial Position, Statement of Financial Condition)
51
A book or original entry in which only cash receipts are recorded.
Cash Receipts Journal
52
A piece of commercial paper drawn on funds in a bank account and payable on demand.
Check
53
Determining the fundamental significance of business transactions so that financial information may be properly processed.
Analyzing
54
A person or company who will receive payment on a promissory note, check, draft, or money order.
Payee
55
An individual who promises to pay on a promissory note; an individual who signs a promissory note.
Maker
56
A book of original entry used to record purchases or merchandise on credit only.
Purchases Journal
57
Any person who agrees to perform a service for a fee and who is not subject to the control of those for whom the service is performed.
Independent Contractor
58
Cash, marketable securities, accounts and notes receivable.
Quick Assets
59
An unwritten promise to pay creditors for property, such as merchandise, supplies or equipment, purchased on credit, or for services received on credit.
Account Payable
60
Sales minus sales returns and allowances minus sales discounts.
Net Sales
61
An unwritten promise by a customer to pay, at a later date, for goods sold or services rendered.
Account Receivable
62
That portion of the original cost of a fixed asset that is assigned as an expense to the reporting period expected to benefit from its use.
Depreciation Expense
63
Discounts from quoted prices as an inducement for prompt payment of invoices.
Cash Discounts
64
A written promise to pay a creditor a certain amount in the future.
Note Payable
65
A decrease in assets, other than withdrawals by the owner, which result from efforts to produce revenues.
Expense
66
The business or individual who owes a debt.
Debtor
67
A check which has ben paid by the bank and returned to the drawer for record keeping.
Canceled Check
68
A check not paid by the bank when properly presented.
Dishonored Check
69
A payment.
Disbursement
70
An individual possessing a college education, having practical experience in accounting and who has passed a comprehensive state examination in order to be certified to practice public accounting in that state.
Certified Public Accountant (CPA)
71
A device for recording the changes (increases or decreases) in the fundamental accounting elements.
Account
72
The process by which the depositor attempts to reconcile the bank statement balance with the checkbook balance.
Bank Statement Reconciliation
73
The process of recording equal debits and credits for a single business transaction.
Double Entry Accounting (Double Entry Bookkeeping)
74
The cost of a fixed asset less its accumulated depreciation.
Book Value (Undepreciated Cost)
75
Entries made at the conclusion of a fiscal period to bring accounts up to date.
Adjusting Entries
76
One who is concerned with the design of the system of records, the preparation of reports based upon the recorded data, and the interpretation of the reports.
Accountant
77
A written order by a buyer for merchandise or other property specified in the purchase requisition.
Purchase Order
78
The recording of financial information in a prescribed manner.
Bookkeeping
79
A specific number of days during which a discount is available if the account is paid.
Discount Period
80
Net sales minus the cost of goods sold.
Gross Profit (Gross Margin)
81
Gross pay less payroll deductions; an employee's take home pay.
Net Pay (Net Earnings)
82
A federal act imposed upon each employer for the purpose of financing the administration costs of the federal and state unemployment compensation programs.
Federal Unemployment Tax Act
83
The process of determining whether the amount of cash, both on hand and in the bank, is the same as that which is indicated in the accounting records.
Proving Cash
84
A book of original entry in which business transactions are recorded in chronological order.
General Journal (Journal)
85
A separate owner's equity account in which withdrawals of cash or other assets by the owner for personal use are recorded.
Drawing Account (Owner Withdrawals)
86
A book of original entry which combines into one journal the features of the two column general journal and a special journal.
Combination Journal
87
Quick assets divided by current liabilities.
Acid Test Ratio (Quick Ratio)
88
A trial balance taken after adjusting entries have been recorded.
Adjusted Trial Balance
89
In accounting, to record in order of time.
Chronological
90
Bringing accounting data together in a way that will further enhance its usefulness, usually by means of reports and statements.
Summarizing
91
Expenses incurred that are not the direct result of regular trading activities of a business.
Other Expenses
92
The amount of pay after deductions (income taxes, FICA taxes, etc.) have been subtracted.
Take Home Pay/ Net Pay
93
A type of asset that will be consumed as it is used. (Examples: embalming supplies and office supplies).
Supplies
94
A period of time covered by an income statement.
Fiscal Period
95
An endorsement which limits the use of funds to the purpose stated (Example: "For deposit only.")
Restrictive Endorsement
96
A source document prepared by the seller listing the items shipped, their cost and the method of shipment (the the buyer's viewpoint).
Purchase Invoice
97
Accounts receivable that are uncollectible.
Bad Debts Expense
| Bad Debts Collectible Accounts Expense, Loss from Uncollectible Accounts
98
The transferal of data from the journal to the ledger.
Posting
99
A form used to request the responsible person or department to purchase merchandise or other property.
Purchase Requisition
100
Generally considered to be compensation for managerial or administrative services, expressed in terms of a month or year.
Salary
101
The loss in value of a fixed asset due to wear and tear and the passage of time; or, a method of matching the cost of a fixed asset against the revenues that the fixed asset will help produce during its useful life.
Depreciation
102
Debts of a business that are generally paid within one year.
Current Liabilities
103
A temporary owner's equity contra account used to record credit given to a customer for shortages or damaged goods.
Sales Returns and Allowances
104
A method in which the depreciable costs basis (original cost basis less salvage value) of an asset that is apportioned equally over its estimated useful life expressed in terms of months or years.
Straight Line Depreciation
105
Measures how many times per year receivables are collected.
Calculation: net credit sales divided by average accounts receivable. Average accounts receivable= (beginning accounts receivable + ending accounts receivable) divided by 2.
Accounts Receivable Turnover
106
The sorting of the many business transactions in an orderly and systematic manner.
Classifying
107
Abbreviation for Federal Insurance Contributions Act.
FICA
108
A skeleton form of an account used for instructional purposes.
T Account
109
State Unemployment Tax Act.
SUTA
110
Measures the average time required to collect receivables.
| Calculation: 360 days divided by Accounts Receivable Turnover
Age of Accounts Receivable
111
Money and money substitutes paid.
Cash Payments (Cash Disbursements)
112
The difference between gross profit and expenses when gross profit is larger.
Net Income (Net Profit)
113
A condition that occurs when the total of the credits in an account is larger than the total of the debits in that account.
Credit Balance
114
Those assets that cannot be touched or grasped (examples include patents, copyrights and goodwill).
Intangible Assets
115
The amount that an employer must withhold from an employee's pay for income tax purposes.
Federal Income Tax Withholding
116
The signature of the payee of other holder placed on the back of a check or other negotiable instrument.
Endorsement (Indorsement)
117
The issuance of a check without sufficient funds in the account when it is presented for payment.
Overdraft
118
Those assets that can be appraised by value or seen or touched.
Tangible Assets
119
A condition which occurs when the total of the debits in an account is larger than the total of the credits in that account.
Debit Balance
120
A check drawn by one back on another bank in which it has funds on deposit.
Bank Draft
121
A formal written statement, which may be based upon adjusted historical data, of management's plans for the future expressed in financial terms.
Budget
122
Income actually earned during an accounting period but which will not be received until a future period.
Accrued Income
123
The effect of transactions on the accounting elements.
Transaction Analysis
124
The period of time from the date of the note to the maturity date.
Time of Note (Term of Note)
125
A temporary owner's equity contra account used to record discounts given to customers as an incentive for prompt payment.
Sales Discount
126
Assets equal liabilities plus Owner's Equity.
Accounting Equation
127
An amount written with the digits in incorrect order.
Transposition Error
128
Items which are considered to be assets when acquired, but which will become expenses when consumed or expired.
Prepaid Expenses
129
A list of all the account titles and the account numbers assigned to them
Chart of Accounts
130
Deposits that have been made and added to the depositor's checkbook, but which have not yet been listed on the bank statement.
Deposits in Transit
131
Money paid for the use of money.
Interest
132
Checks that have been drawn and subtracted from the depositor's checkbook, but which have not yet been presented to the bank for payment.
Outstanding Checks
133
A fund of currency and coin established for the payment of small amounts of money.
Petty Cash Fund
134
The difference between gross profit and expenses when expenses are larger.
Net Loss
135
The book of accounts.
General Ledger (Ledger)
136
A source document prepared by the seller that lists the items shipped, their cost and the method of shipment (from the seller's viewpoint)
Sales Invoice
137
A person (depositor) who signs a check, ordering a payment to be made.
Drawer
138
The handwritten signature of the payee on the back of the check.
Blank Endorsement
139
Those goods or stock of goods which are held for resale at a profit.
Inventory (Merchandise)
140
Purchases minus purchase returns and allowances minus purchase discounts.
Net Purchases
141
One who is under the control and direction of an employer with regard to the performance of employment.
Employee
142
A form of compensation usually for skilled and unskilled labor, expressed in terms of hours, weeks or pieces completed.
Wage
143
The date on which the payment is due on the promissory note.
Maturity Date
144
An expanded trial balance utilized for computing, classifying, and sorting account balances before preparing the formal financial statements.
Worksheet
145
A check which carries the guarantee of the bank that sufficient funds are available to pay the check when it is presented.
Certified Check
146
A contra account utilized to accumulate totals against accounts receivable.
Allowance for Doubtful Accounts (Allowance for Bad Debts)
147
The first record of a business transaction, such as check stubs, receipts, sales invoices, purchase invoices, cash register tapes, etc.
Source Document (Business Paper)
148
A three-month period.
Quarterly
149
Coins, currency (paper money), checks, credit card receipts and money orders received from others, as well as money deposited in the bank.
Cash
150
Any debts that a business owes.
Liabilities
151
One who is involved in the process of recording financial information in a prescribed manner.
Bookkeeper (Information Processor)
152
Current assets divided by current liabilities.
Current Asset Ratio
153
A person or company whose name is written on the back of a check.
Endorser
154
An order by a depositor requesting a bank not to pay on a check previously issued.
Stop Payment Order
155
The process of recording business transactions in a journal.
Journalizing
156
The process involved in journalizing, posting to the ledger, taking a trail balance, preparing statements, making adjusting and closing entries, and preparing a post-closing trial balance, which is repeated each fiscal period.
Accounting Cycle
157
Explaining the significant events or developments that occur, usually taking the form of analysis and comparisons.
Interpreting
158
Income received that is not the direct result of regular trading activities of a business.
Other Income
159
The amount by which the total assets exceed the total liabilities of a business; an owner's financial interest in a business.
Owner's Equity (Net Worth, Capital, Proprietorship)
160
An itemized listing prepared by the bank of additions to the subtractions from a depositor's account.
Bank Statement
161
End of Month.
EOM
162
The annual percentage rate used to compute interest.
Rate
163
A written promise made by a person or business to pay a certain sum of money to another person or business at a specified time in the future.
Promissory Note
164
A formal financial statement which summarizes all of the changes in owner's equity during a specified period of time.
Statement of Owner's Equity (Statement of Net Worth)
165
The left side of a standard account.
Debit
166
An accounting entry that involves more than two accounts.
Compound Journal Entry
167
The abbreviation of credit.
CR.
168
A form on which information is recorded by the drawer of a check concerning the check drawn; a source document.
Check Stub
169
The estimated determinable life of a fixed asset.
Useful Life
170
An inflow of assets as a result of selling a product or providing a service.
Income (Revenue)
171
A temporary owner's equity account used to record the earning of revenue.
Sales
172
A report furnished by the employer for each employee indicating the gross earnings and deductions for income and FICA taxes.
W-2 Form (Wage and Tax Statement)
173
The committing of a business transaction and the events surrounding such into writing.
Recording (Data Entry)
174
An account designed to accumulate totals to offset a related account.
Contra Account
175
A book or original entry used for the recording of sales of merchandise on credit only.
Sales Journal
176
The principal sum of the maker of a note promises to pay.
Face of Note
177
The number of times the average inventory has been sold or used up (turned over) during a period.
Calculation:
365 divided by (cost of goods sold for period divided by average inventory).
Average inventory = (beginning inventory +ending inventory) divided by 2.
Inventory Turnover
178
A tax imposed on tangible person property sold at retail.
Retail Sales Tax
179
A long term liability; a written promise that pledges real property as security for payment of a debt.
Mortgage Payable
180
A bank form which lists those cash items (currency and coin) and individual checks to be deposited.
Deposit Ticket (Deposit Slip)
