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ACC311 - Ch 4
n/a
29
Accounting
Undergraduate 4
05/15/2012

Additional Accounting Flashcards

 


 

Cards

Term
Income from Continuing Operations
Definition
1. Revenues
2. Expenses
3. Gains/Losses
4. Income Tax Expense
Term
Revenues
Definition
Inflows resulting from providing goods/services
Term
Expenses
Definition
Outflows incurred in generating revenues
Term
Gains/Losses
Definition
Inc/Dec in equity from peripheral/incidental transacations
Term
Income Tax Expense
Definition
Separate Item
Term
Operating Income
Definition
Rev/Exp related to principal revenue-generating activities
Term
Nonoperating Income
Definition
Gains/Losses & Rev/Exp related to peripheral or incidental activities
Term
Earnings Quality
Definition
Ability of reported earnings to predict future earnings
Term
Manipulate Income
Definition
1. Income Shifting
2. Income Statement Classification
Term
Restructuring Costs
Definition
Shutdown or relocation of facilities or downsizing of operations
Term
Goodwill Impairment & Long-Lived asset impariment
Definition
impairment losses or changes
Term
Nonoperating income/earnings quality
Definition
gains/losses generated from sale of investments can inflate/deflate current earnings
Term
Separately Reported Items
Definition
1. Discountinued Operations
2. Extraordinary Items

Net of taxes
Term
Reporting for COmponents Sold
Definition
Gain/Loss on disposal of assets
Term
Reporting for Components Held for Sale
Definition
"impairement loss" if
carrying value>(fair value-cost to sell)
Term
Extraordinary Items
Definition
1. Unusual in nature
2. Infrequent in occurrence

net of related taxes
Term
Unusual/Infrequent Items
Definition
if not BOTH
included as separate items in continuing operations
Term
Accounting Principle Change
Definition
One GAAP method to another

- LIFO to FIFO
Term
Accounting Estimate Change
Definition
Revision of estimate after new information

- Revision of previous estimate
2. use new estimate in current and future
3. depreciation, amortization, depletion
Term
Reporting Entity
Definition
Fin. Statement Prep for other accounting entity
Term
Accounting Errors
(same year
Definition
Reverse original entry and record appropriately
Term
Accounting Errors
(subsequent years)
Definition
- record prior period adjustment to beginning RE balance of SE
- previous incorrect fin. statements retrospectively restated to reflect correction
Term
Earnings Per Share Ratio
Definition
Amount of income earned by a company expressed on a per share basis

BASIC: (NI-Pref Div)/(weighted avg # of common shares)
Term
Statement of Cash Flows
Definition
-Provides relecant information about cash receipts/disbursements
-helps investors/creditors asses
1. future net cash flows
2. liquidity
3. lt solvency
-required for each income stmnt period reported
Term
Operating Activities
CASH FLOWS
Definition
INFLOWS
1. sales
2. int/div received

OUTFLOWS
1. inventory purchase
2. salaries, wages, op expenses
3. debt interest
4. income taxes
Term
Direct Method
Definition
Reports cash effects of each operating activity
Term
Indirect Method
Definition
Starts with accrual NI and converts to cash basis
Term
Investing Adtivities
CASH FLOWS
Definition
INFLOWS
1. sale of long-lived asset
2. sale of investment securities
3. collection of nontrade receivables

OUTFLOWS
1. long-lived asset purchase
2. purchase of investment
3. loans to other entities
Term
Financing Activities
CASH FLOWS
Definition
INFLOWS
1. sale of shares to owners
2. borrowing from creditors

OUTLFOWS
1. owners in the form of div
2. owners for reacquisition of shares
3. creditors as repayment of debt
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