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45 Cards in this Set
- Front
- Back
Accounting |
Classifying & recording financial transactions, presenting and interpreting results for decision making |
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Accounting entity concept |
Accounting information relates only to business activities not owners activities |
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Accounting equation |
Relationships between assets, liabilities and owners equity |
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Accounting period |
Time covered by the accounting statements of an entity |
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Accounting rate of return |
Average annual profit expressed as a percentage of original capital investment |
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Accounting standard |
Authoritative statement to how transactions should be reflected in financial statements to give a true and fair view |
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Accounts Payable |
Money owed by a business for purchases for made from suppliers of goods and/or services |
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Accounts receivable |
Money owed by customers to a business from sale of goods &/or services |
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Accrual-basis accounting |
Recognises revenue when earned or expenses when incurred regardless of when money is exchanged |
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Accrued expense |
Payment not yet made for an expense already incurred |
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Accrued revenue |
Payment not yet received for goods delivered or a service already performed |
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Accumulated depreciation |
The portion of the original cost of a non-current asset written of as a depreciation expense to date |
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Activity based budgeting |
Budgeting based on an activity framework using cost driver data |
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Annuity |
Equal amount of receipts at equal intervals of time |
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Assets |
Items of value owned by a business which would be of benefit in the future |
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Audit |
Examination of an entities activities and status, investigating systems, controls and records |
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Balance sheet |
A statement of the financial position of an entity at a given date disclosing the assets, liabilities and accumulated funds such as shareholders contributions and reserves. |
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Benchmarking |
The comparison of activities to world-class best practices Or the establishment (through data gathering) of targets and comparators to identify relative levels of performance. |
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Break even point |
The level of activity at which there is neither profit nor loss |
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Bridging finance |
Supplementary finance made available on the evidence of a main borrowing. |
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Budget |
A quantitative statement for a defined period of time which may include planned revenues, expenses, assets, liabilities and cash flows |
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Budget period |
The period for which the budget is prepared: it may be a year, a quarter, a month or a week |
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Capital Expenditure |
Expenditure on long-lived assets |
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Capital rationing |
Allocating limited capital funds among competing projects to maximise the total net present value |
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Capital structure |
The mix of different forms of capital employed by a business |
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Cash basis accounting |
Recognises transactions only when cash is received or paid |
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Cash budget (cash flow plan) |
A detailed budget of cash inflows and outflows incorporating both revenue and capital items |
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Cash flow statement |
A statement which shows cash inflows and cash outflows during an accounting period |
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Cash inflows |
Cash receipts from operations |
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Cash outflows |
Cash outlay on projects and operations |
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Chart of accounts |
A list of all the accounts and their identifying numbers in the ledger |
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Collection period |
The average number of days it takes to collect accounts receivables |
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Commercial bills |
The bills of exchange (described also as accomodation bills or trade bills) that are documents prepared or drawn by the seller and accepted by a buyer promising to pay the seller a certain sum of money on a specified due date |
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Compound interest |
Interest obtained by adding separate interests for several periods, the principal and interest for one period becoming the principal for the next period |
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Contribution margin |
The excess of sales over variable expenses during an accounting period |
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Controllable costs |
Costs heavily influenced by a manager |
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Cost centre |
An area (or division) of an organization for which costs are conveniently accumulated |
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Cost of capital |
The cost of finance employed by a business |
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Cost of goods sold (by manufacturer) |
COGS= Opening inventory (of finished goods) + cost of goods manufactured - closing inventory of finished goods
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Current assets |
The cash of a business and its other assets that are convertible to cash within one year |
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Current liabilities |
Business debts that are payable within one year |
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Current ratio |
The ratio of current assets to current liabilities |
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Cost of goods manufactured |
Opening work in progress + manufacturing costs for period - closing work in progress |
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Cost of sales |
COS = Opening inventory + purchases and other associated costs - Closing inventory |
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Amortization |
Spreading payments over multiple periods |