Term
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Definition
| Liabilites (Owe) + Equity (Net Worth) |
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Term
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Definition
| Assets (Own) - Liabilities (Owe) |
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Term
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Definition
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Term
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Definition
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Term
| What can impact the assets formula? |
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Definition
| Transactions and events (Dual impact) |
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Definition
| anything that is payed back to the loaner |
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Definition
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Definition
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Definition
| Bonds create this type of return |
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Term
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Definition
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Term
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Definition
Finish - Start
Start = Decimal (Make Percentage) |
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Term
| 4 Other Elements related to E in the formula |
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Definition
| Revenue, Expenses, Dividends, Investment By Owner |
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Term
| 7 Elements to the formula |
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Definition
| Assets (Own), Liability (Owe), Equity, Revenue (Earned), Expenses (Incurred/used), Dividends, Investment By Owner |
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Definition
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Definition
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Definition
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| Equals Expenses: Decreases Both Sides Of THe Equation |
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Term
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Definition
| Equals = Revenue: Increases both sides of the equation |
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Definition
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Term
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Definition
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Term
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Definition
| Record revenues when cash is received, and expenses when paid |
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Term
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Definition
| assets, liability, equity |
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Term
| economic entities raise capital by selling |
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Definition
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Term
| an income statement includes what 2 elements |
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Definition
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Term
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Definition
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Term
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Definition
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Term
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Definition
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Definition
| a point in time statement |
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Term
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Definition
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| recent fed legislation (2002) |
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Definition
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Term
| economic entities raise capital by selling |
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Definition
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Term
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Definition
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Term
| Asset and Liability Accounts |
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Definition
Cash
Investments
Accounts Receivable
Inventory
Prepaid Expenses, Property, Plant & Equipment
Intangibles, Accounts Payable
Other Payable (e.g.Taxes)
Notes Payable
Bonds Payable |
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Term
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Definition
| cash, A/R, Supplies, P.P.E |
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Term
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Definition
| A/P (Accounts Payable), B/P |
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Term
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Definition
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Term
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Definition
| Generally Accepted Accounting Principles |
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Term
| What is retained earnings |
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Definition
| revenue - expenses - dividends |
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Term
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Definition
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Term
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Definition
| Expense account that represents the periodic allocation of the cost of an intangible asset |
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Term
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Definition
| Retained Earnings, Paid In Capital |
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Term
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Definition
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Term
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Definition
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Term
| 3 elements that increase when Equity increases |
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Definition
| Revenue, Dividends, Retained Earnnigs, Investment by Owner |
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Term
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Definition
| Return (Net Income)/Assets or Return (Net Income)/Equity |
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Term
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Definition
| the ability to pay short term debt |
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Term
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Definition
| Current Assets/Current Liability |
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Term
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Definition
| The ability to pay long term debt |
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Term
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Definition
| Debt (Total Liability)/Equity |
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Term
| Gross Profit Percentage (Margin) Formula |
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Definition
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Term
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Definition
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Term
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Definition
| earnings retained in the business |
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Term
| Retained Earnings Formula |
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Definition
| Revenue - Expenses - Debt |
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Term
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Definition
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Term
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Definition
| Balance Sheet, Income Statement, Statement Of Cash Flows, Statement Of Stockholders Equity |
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Term
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Definition
| Expense account that represents the periodic allocation of the cost of an asset |
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Term
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Definition
| Shows the effect of transactions and events on a specific element. For example, cash on assets, or sales on revenue. |
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Term
| what are the 2 largest sources of capital |
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Definition
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Term
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Definition
| Current Assets - Current Liabilities |
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Term
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Definition
| These are the principles, assumptions, and constraints that form the foundation for Financial Recognition and Disclosure |
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Term
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Definition
| The total amount owed to suppliers/vendors for using their goods or services, on account. |
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Term
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Definition
| Recording revenues when earned and expenses when incurred (or when non-cash resources are USED). |
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Term
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Definition
| The accounting process that periodically transfers costs from one place or account, to another. |
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Term
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Definition
| Accounting concepts, (economic entity, going concern, monetary unit, and periodicity) that establish reporting requirements |
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Term
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Definition
| The systematic assessment of an entity’s conformity with GAAP. |
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Term
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Definition
| Refers to the underlying theory or value. |
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Term
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Definition
| A contract that represents a company’s borrowing from creditors. Often called a debt security, or fixed income investment. |
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Term
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Definition
| The dollar amount balance within an account. |
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Term
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Definition
| For accounting it is revenues minus expenses = zero; for finance it is sales minus costs = zero. |
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Term
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Definition
| Is the investigation of various sales and cost scenarios. For example, what happens to breakeven when fixed costs increase 10%, variable cost per unit by 20%, etc. |
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Term
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Definition
| Any asset used to generate revenue or make a long-term investment. |
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Term
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Definition
| The process of selecting an investment(s) in capital projects; for example, a factory, or product. |
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Term
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Definition
| Is the accounting process that records costs as assets. |
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Term
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Definition
| Recording revenue when cash is received and expenses when paid. |
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Term
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Definition
| Accounting Concepts, (materiality, conservatism, cost/benefit, industry practices) that establish reporting requirements. |
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Term
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Definition
| Is computed on principal and on the interest earned that has not been paid or withdrawn. |
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Term
| Contribution margin per unit |
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Definition
| The difference between the sales price per unit, and the variable cost per unit. |
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Term
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Definition
| An economic entity with special legal rights. Formed by state laws. Provides limited liability to shareholders. |
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Term
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Definition
| Acquisition or exchange price. The initial value of an item. |
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Term
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Definition
| The accumulation and assignment of costs to objects (e.g. product or service). |
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Term
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Definition
| The interest rate on outstanding debt. |
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Term
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Definition
| Cost of the goods or services that were sold to produce sales. Also called Cost of Sales. |
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Term
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Definition
| The ability to borrow money. |
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Term
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Definition
| Assets that will be sold, consumed, used, or turned into cash, within one year. |
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Term
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Definition
| Obligations that will be retired within one year using Current Assets. |
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Term
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Definition
| An investment strategy that decreases risk. |
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Term
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Definition
| The study of money and markets. |
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Term
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Definition
| A happening of consequence. An event generally is the source or cause of changes in assets, liabilities, and equity. Events may be external or internal. |
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Term
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Definition
| Economic activity can be identified with a particular unit of accountability. |
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Term
| Can Assets and liabilities be negative |
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Definition
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Term
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Definition
| anything to be sold, used, consumed, or otherwise turned into cash within a year. Such as: Cash, accounts receivable, inventory, investments, pre- paids (Rent, other service) |
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Term
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Definition
| Assets lasting more than one year. This includes: PPE, etc. |
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Term
| Retained Earnings Formula |
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Definition
| Revenue - Expenses - Dividends |
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Term
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Definition
| Point in time representation of a company's finances. |
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Term
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Definition
| Period-In-Time representation of a company's finances. Does not include Equity. |
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Term
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Definition
| Principle x Rate x Time (I=PxRxT) |
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Term
| 3 Sections of the Statement of Cash flow |
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Definition
| operating, investing, financing |
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Term
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Definition
| Current Assets/Current Liabilities |
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Term
| Debt-To-Equity Ratio Formula |
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Definition
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Term
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Definition
| Measure as a return on equity or assets. |
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Term
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Definition
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Term
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Definition
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Term
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Definition
| a balance that captures the increases and decreases in monies. |
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Term
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Definition
| Securities and Exchanges Commission-responsible for enforcing GAAP standards |
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Term
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Definition
| Financial Accounting Standards Board-private, not-for-profit organization that creates the GAAP standards |
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Term
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Definition
| Sarbanes-Oxley-the name of the 2002 reform act new or enhanced standards for all public US companies and their accounting practices. |
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Term
| What are the two largest sources of capital? |
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Definition
• Investment by owner or investors
• Bonds payable or revenue |
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Term
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Definition
| the accrual basis cost of an item recorded as the item is sold |
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Term
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Definition
| the amount of units sold where net revenue is $0 |
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Term
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Definition
calculated as fixed costs/contribution margin per unit
Fixed costs are $60000, and the contribution Margin is $6, the BE number is 10000 |
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Term
| Contribution Margin Formula |
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Definition
| Sales-Variable Costs, If a product costs $12 to make and sells for $18, the contribution margin is $6 |
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Term
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Definition
| Contribution Margin-Fixed Costs |
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Term
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Definition
| High Fixed Costs and Low Variable Costs |
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Term
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Definition
| Low Fixed Costs and Low or High Variable Costs |
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Term
| Time-Value Of Money Formula |
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Definition
| Net Present Value-Present Value of Future Cash Flow |
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Term
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Definition
| calculating the present value of future cash flows (i.e. what is $1100 in a year worth today?) |
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Term
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Definition
| a fixed amount per time period |
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Term
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Definition
| The minimum expected return on an investment |
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Term
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Definition
| used to produce goods and services |
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Term
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Definition
| intangible claims to real assets |
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Term
| NYSE (New York Stock Exchange) |
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Definition
| The biggest stock exchange |
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Term
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Definition
| Electronic stock exchange |
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Term
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Definition
| gets paid first, sometimes has voting rights |
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Term
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Definition
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Term
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Definition
| s production goes up or down, these costs remain the same |
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Term
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Definition
| As production goes u or down, these costs go up or down |
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Term
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Definition
| All costs allocated to a product or service |
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Term
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Definition
| Cost traces directly to a product or a service |
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Term
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Definition
| The interest paid on your debt |
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Term
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Definition
| The return sacrificed by choosing an alternative |
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Term
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Definition
| Costs incurred that aren't part of the analysis |
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Term
| What expense account represents the periodic allocation of the cost of an asset? |
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Definition
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Term
| How do you calculate depreciation? |
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Definition
| Straight-line computation |
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Term
| What two reasons could account for a decrease in equity? |
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Definition
| Increase in dividends or expenses |
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Term
| What could cause an increase in equity? |
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Definition
| Sale for cash, or investment by owner |
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Term
| What two accounts can affect equity? |
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Definition
| Paid-in capital and retained earnings |
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Term
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Definition
| anything directly related to the manufacture-material, labor, factory overhead |
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Term
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Definition
| all expenses that are not related to the COGS |
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