Flashcards
Chapter 16 Key terms
Flashcards do conjunto (50)
- 1Accounts PayableAmounts owed to creditors for services or items purchased
- 2Accounts ReceivableAmounts owed by customers to a business from previous sales
- 3Acid TestCurrent assets less inventory less prepaid expenses divided by current liabilites
- 4Asset turnoverNet sales divided by total assets
- 5AssetsThings of value owned by a business
- 6Average day's collectionNumber of days to collect your receivables
- 7Balance sheetFinancial repot that lists assets, liabilities, and equity. Report reflects the financial position of the company as of a particular date
- 8CapitalOwners' investment in the business
- 9Common StockUnits of ownership called shares
- 10Comparative statementStatement showing date from two or more periods side by side
- 11CorporationCompany with many owners or stock-holders. equity of these owners is called stock-holders equity
- 12Cost of merchandise (goods) soldBeginning inventory + Net purchases - Ending inventory
- 13Current assetsAssets that are used up or converted into cash within 1 year or operating cycle
- 14Current liabilitiesDebts or obligations of the company that are due within 1 year
- 15Current ratioCurrent assets divided by current liabilites
- 16ExpensesCost of doing business; found on the income statement
- 17Gross Profit from salesNet sales - Cost of goods sold
- 18Gross salesTotal earned sales before sales returns and allowances or sales discounts
- 19Horizontal analysisMethod of analyzing financial reports where each total this period is compared by amount of percent to the same total last period
- 20Income statementFinancial report that lists the revenues and expenses for a specific period of time. It reflects how well the company is preforming
- 21LiabilitiesAmounts business owes to creditors
- 22Long-term LiabilitiesDebts or obligations that company does not have to pay within 1 year
- 23Merchandise InventoryCost of goods for resale
- 24Mortgage note payableDebt owed on a building that is a long-term liability; often the building is the collateral
- 25Net IncomeGross profit less operating expenses
- 26Net purchasesPurchases - Purchase discounts - Purchase returns and allowances
- 27Net salesGross sales - Sales discounts - Sales returns and allowances
- 28Operating expensesRegular expenses of doing business. These are not costs
- 29Owner's equityThe portion of a company's assets that an owner can claim
- 30PartnershipBusiness with two or more owners
- 31Plant and equipmentAssets that will last longer than 1 year
- 32Prepaid expensesItems a company buys that have not been used are shown as assets
- 33Profit margin on net salesAmount of net income as a percent of net sales
- 34Purchase discountsSavings received by buyer for paying for merchandise before a certain date
- 35Purchase returns and allowancesCost of merchandise returned to store due to damage defects and so on. An allowance is a cost reductions that results when buyer keeps or buys damaged goods
- 36PurchasesMerchandise for resale; found on the income statement
- 37Quick assetsCurrent assets - Inventory - Prepaid expenses
- 38Quick ratio(Current assets - Inventory - Prepaid expenses) / Current liabilities
- 39Ratio analysisRelationship of one number to another
- 40Retained earningsAmount of earnings kept in the business
- 41Return on equityNet income divided by stockholders' equity
- 42RevenuesTotal earned sales (cash or credit) less any sales discounts, returns or allowances
- 43Salaries payableObligations that a company must pay within 1 year for salaries earned but unpaid
- 44Sales (not trade) discountsReductions in selling pice of goods due to early customer payment
- 45Sales returns and allowancesReductions in price or reductions in revenue due to good returned because of product defects errors and so on. when the buyer keeps the damages goods an allowance results
- 46Sole proprietorshipA business owned by one person
- 47Stockholders' equityAssets less liabilites
- 48Total debt to total assetsAmount of debt as a percent of total assets
- 49Trend analysisAnalyzing each number as a percentage of a base year
- 50Vertical analysisMethod of analyzing financial reports where each total is compared to one total
Informações
- Descrição
- Key terms for Chapter 16: How to Read, Analyze, and Interpret Financial Reports
- Criado por
- BRANDI MCCAMMON
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