A

• Abandonment

  The retirement of a fixed asset from service.

• Abatement

  Complete or partial cancellation of a prospective expenditure.

• Above the Line

  A phrase used to designate a customary balance sheet or revenue-or expense item in a financial statement.

• Absorb

  To merge, by transfer, all or part of an account or group of accounts with another account so that the identity of the first is lost, as by the transfer of operating expenses from basic-expenditure accounts to work in process, or from work in process to finished stock, or from finished stock to cost of sales.

• Absorption Account

  An account offsetting, in whole or in part, one or more related accounts; the purpose is to preserve the identity of such accounts, as well as accumulate periodic transfers to other accounts.

• Absorption Costing

  The process of allocating all (full absorption costing) or a portion (direct and standard costing) of fixed and variable production costs to work-in-progress, cost of sales, and inventory.

• Accelerated Depreciation

  Depreciation at a greater than usual rate because of plan operations at more than normal speed, use, or capacity.

• Acceptance

  An agreement signed by the drawee to honor a draft.

• Accommodation Endorsement

  An endorsement by one person, without consideration, on a note or other credit instrument to which another person is a party, for the purpose of establishing or strengthening the other's credit.

• Accommodation Note (or paper)

  A note signed by one person as maker, endorser, or acceptor on behalf of another whose credit standing is weak or nonexistent.

• Accommodation Purchase

  A good or service acquired by an organization on behalf of another, or for a customer or employee, usually because of superior purchasing facilities, larger discounts, or other advantage.

• Account

  Transactions that are determined to be the same and grouped under one title in the ledger.

• Account Balance

  Difference between the total debit postings and total credit postings in an account.

• Account Current

  Any personal account on which periodic settlements are made.

• Account Receivable Discounted

  An account receivable that has been assigned or sold with recourse; until paid by the debtor, the amount of the account is the seller's contingent liability.

• Account Sales

  An interim or final statement rendered by a consignee or sales agent showing particulars of sales of goods consigned, expenses incurred, commissions, and the balance, if any, due the consignor.

• Account Stated

  An account, the balance of which, as determined by the creditor, has been accepted as correct, sometimes implicitly, by the debtor.

• Accounting Control

  The administrative procedures employed to maintain accurate and proper transactions as well as bookkeeping records.

• Accounting Period

  The customary span of time for which an operating statement is prepared.

• Accounting Principles

  The body of doctrine associated with the practice of accounting, serving as an explanation of current methods and as a guide in the selection of conventions and procedures.

• Accounting System

  The principles, methods, and procedures relating to the incurrence, classification, recording, and reporting of the transactions of an organization.

• Accounting Valuation

  The historical money amount attaching to any asset or expense, generally representing cost; money outlay at the time of acquisition.

• Accounts Payable

  Total a business owes to its creditors.

• Accounts Receivable

  A claim (amount due) from a debtor.

• Accrual

  The recognition of income and expenses as they occur even if not received or paid for until later.

• Accrual Basis

  A method of accounting where all income earned and expenses incurred, prepaid or unpaid, are assigned to specific periods of time.

• Accrual Costing

  The expensing of goods and services as they are applied or consumed.

• Accrual Date

  The date through which an accrual extends.

• Accrue

  To grow; to increase; to accumulate.

• Accrued Asset

  Interest, services, or revenues earned but not received.

• Accrued Depreciation

  The total depreciation suffered by an asset or asset group, based on customary or fairly determined rates or estimates of useful life, generally referred to as accumulated depreciation.

• Accrued Dividend

  The amount of unpaid and undeclared dividend on preferred stock.

• Accrued Expenses

  Liability for expenses that have been incurred and are not paid but are payable at some future date.

• Accrued Income

  Asset arising from income earned, but not received, at a given date; also known as accrued revenue.

• Accrued Liabilities

  Liabilities incurred, but not paid, payable at some future date.

• Accrued Revenue

  Revenue earned, but neither received nor past due.

• Accumulated Depreciation

  The fixed-asset valuation account offsetting depreciation provisions.

• Accumulated Distribution

  Income received and accumulated by a trust for distribution in the future.

• Accumulated Dividend

  Dividend in arrears.

• Accumulated Income

  Net income retained and not paid out in dividends or dissipated by subsequent losses.

• Accumulation

  The periodic addition of (a) interest or other increase to the principal of a fund, (b) annual net income to retained earnings, or (c) amortized discount to an investment or obligation in order to raise the principal sum to the amount ultimately receivable or payable.

• Act of God

  Term used in insurance to refer to an event leading to a property loss caused by forces of nature that could not have been prevented by reasonable care or foresight; e.g., flood, lightning, earthquake, hurricane.

• Activity Account

  An income or expense account containing transactions over which an activity supervisor assumes responsibility and maintains control.

• Actual Cost

  Cost, as of acquisition or production, of the former net of discounts and allowances but including transportation and storage; often averaged for internal-transfer or inventory purposes.

• Actuarial Basis

  A basis compatible with principles followed by actuaries; said of computations involving matters such as compound interest, and retirement and mortality estimates.

• Actuary

  One skilled in insurance, mathematics, or statistics.

• Ad Valorem

  Designating a property tax or import or other duty computed as a percentage (rate) of the value of the property.

• Added Value

  Any of the segments of the selling price of a commodity or service originating in the present or a prior stage.

• Added-Value Tax

  A percentage tax on the value of a commodity or service, added at the completion of each constituent state of its production and distribution.

• Additional (paid-in) Capital

  Contributions of stockholders credited to accounts other than capital stock.

• Additional Mark-on

  Term in retail accounting signifying an addition to a previously established mark-on.

• Adjusted Basis

  The basis used in computing depreciation, or gain or loss on sales of fixed or non-inventory assets.

• Adjusted Gross Income

  The gross income of an individual, reduced by (a) business expenses [as to employees, only those specified in section 62 (2) of the Internal Revenue Code], (b) any deductions allowed for income-producing property, (c) certain losses from sales or exchanges of property, (d) self-employment expenses, and (e) moving expenses.

• Adjusted Historical Cost

  Historical cost raised to current cost by means of a price index or series of price indexes.

• Adjusting Entry

  Journal entry for the purpose of correcting a general ledger account or bringing it up to date.

• Adjustment

  Any change in an account produced by an adjusting entry.

• Administrative Budget

  A financial plan according to which an organization carries on its day-to-day affairs under the common forms of administrative management; a budget.

• Administrative Expense

  An expense incurred in the general direction of an enterprise as a whole, as contrasted with the expense of a more specific function, such as manufacturing or selling, but not including income deductions.

• Admissible Asset

  An asset which, under provisions and regulations of former excess-profits-tax laws, had been allowed as an inclusion under invested capital.

• Admitted Asset

  Insurance term signifying an asset, as determined under the laws of various jurisdictions, having a value in liquidation.

• Agency

  The relation between principal and agent.

• Agent

  One who represents, acts for, and accounts to another.

• All-Inclusive Income Statement

  An income statement containing all items of profit and loss given recognition during a specific period.

• All-Purpose Financial Statement

  A financial statement serving, as far as possible, the needs of all users.

• Allocable

  Identifiable with two or more objects, activities, functions, or other cost objectives; said, for example, of a joint or common cost, or an overhead pool of expense accounts.

• Allocate

  To charge an item or group of items of revenue or cost to one or more objects, activities, processes, operations, or products, in accordance with cost responsibilities, benefits received, or some other readily identifiable measure of application or consumption.

• Allotment

  The administrative assignment by an agency of a part of an appropriation, allocation, or apportionment to a subdivision of the agency.

• Allotment Ledger

  A subsidiary ledger containing an account for each allotment, showing the amount allotted, expenditures, encumbrances, and unencumbered balance.

• Allowance

  Permitted tolerance in measurement, quality, or quantity of goods.

• Amortization

  The gradual extinguishment of any amount over a period of time.

• Amortization Schedule

  A table in which computations are provided for the periodic write down until maturity of the premium paid on a bond or note.

• Amortized Cost

  Cost, less portions written off.

• Annuity

  A fixed amount of money payable yearly or at regular intervals.

• Articles of Co-Partnership

  Written substance of an agreement of partnership.

• Assets

  Resources that have monetary value.

• Authorized Capital Stock

  Under its charter, the maximum number of shares of stock that a corporation may issue.

B

• Bad Debt

  An account that cannot be collected.

• Bailment

  A delivery or transfer of possession of money or personal property for a particular purpose, as on consignment or for safekeeping or repairs.

• Balance Sheet

  A statement of financial condition of a business at a certain date showing its assets, liabilities, and capital.

• Balance-Sheet Account

  An account, the amount of which, alone or in combination with others appears on a balance sheet.

• Bank Discount

  Advance deduction by a bank of interest on a loan.

• Bank Overdraft

  The amount owing to a bank by a depositor as the consequence of checks drawn by him in an amount exceeding his deposits in a commercial account.

• Base Period

  The span of time chosen for a standard of comparison.

• Basic Cost

  Outlay measured in terms of the original purchase-for-use of an item of property.

• Basis

  Cost, or a value employed as a substitute for cost.

• Batch

  A specific quantity of materials or parts composing a purchase of goods.

• Batch Costing

  A method of cost accounting whereby costs are accumulated by batches or runs, as in the petroleum, chemical, and rubber industries.

• Below Par

  At a discount; less than face value.

• Below the Line

  Classification for an unusual revenue or expense or an extraordinary and material nonrecurring item requiring a separate showing or grouping on a balance sheet or income statement.

• Bill of Exchange

  An unconditional order in writing addressed by one person to another, signed by the person giving it, requiring the person to whom it is addressed to pay on demand or at a fixed or determinable future time, a sum certain in money to order or to bearer.

• Bill of Lading

  Carrier's written document constituting a receipt for goods shipped as well as a contract to deliver the goods in a specific manner.

• Bill of Materials

  Document specifying the character and quantity of the materials and parts comprising a certain product.

• Bill of Sale

  A written agreement by the terms of which a person assigns or transfers his title or other interest in goods to another person.

• Blanket Insurance

  An insurance contract concerning any generic class of property; the number of items included may fluctuate from time to time.

• Board of Directors

  Persons elected by the stockholders to advise and assist management with the corporation's affairs.

• BOM

  Beginning of month.

• Bond

  An interest-bearing promise of a corporation, generally secured, to pay a fixed amount to holders at a designated future time.

• Bond Discount

  The excess of par or face value of a bond over the amount paid.

• Book Inventory

  An inventory that is not the result of actual stocktaking but of adding the units and the cost of incoming goods to previous inventory figures and deducting the units and cost of outgoing goods.

• Book of Original Entry

  A journal containing the first entry of transactions and serving as the source of posing to the ledger.

• Book Profit

  Profit as shown by the books of account before verification or audit; contrasted with "economic" profit or profit determined on some other basis.

• Boot

  Something in addition; specifically for federal income tax purposes in a property exchange that would otherwise be tax free.

• BOY

  Beginning of year.

• Breakeven Chart

  Any of several types of charts that indicate the breakeven point.

• Breakeven Point

  The volume point at which revenue and costs are equal; a combination of sales and costs that will yield a no-profit, no-loss operation.

• Bring Forward

  To inscribe the balance or the total debits and credits of an account, worksheet, or any tabular statement upon a new page or sheet or upon a cleared section of an old sheet.

C

• C&F

  Cost and freight: a term indicating that the quoted price of an object of sale includes charges for handling and freight up to delivery to a foreign port, the purchaser assuming costs of insurance and unloading, transportation, and other costs at or from the foreign port.

• Capital

  The difference between a business owner's total assets and total liabilities; equity or investment.

• Capital Asset

  An asset intended for continued use or possession, common sub-classifications being (a) land, building and equipment, leaseholds, mineral deposits, timber preserves (fixed assets); (b) goodwill, patents, trademarks, franchises (intangibles); (c) investments in affiliated companies.

• Capital Expenditure

  An expenditure intended to benefit future periods, in contrast to a revenue expenditure, which benefits a current period; an addition to a capital asset.

• Capital Goods

  A term in economics commonly used for fixed assets, sometimes including items contributing to production for which no business outlay is required.

• Capital Stock

  The ownership shares of a corporation authorized by its articles of incorporation.

• Capital Surplus

  That part of the paid-in capital of a business not assigned to capital stock; i.e., contributions by stockholders in excess of par or stated value of shares.

• Capitalize

  To record and carry forward into one or more future periods any expenditure the benefits or proceeds from which will then be realized.

• Capitalized Expense

  An item of cost usually charged to profit and loss, but, because related to a period of construction, added to a capital-asset account.

• Carry Down

  To transfer the balance of a two-column account that has been ruled off, usually at the close of an accounting period, to a line immediately below the ruling, the purpose being to reopen the account as a single net figure at the beginning of the next accounting period.

• Carry Forward

  To defer the classification of an item of revenue or expense as nominal until such time as the revenue is earned, or the benefit is received from the expenditure.

• Carry-Forward Working Papers

  Working papers, often a part of a permanent file, containing running analyses or summaries of fixed assets, reserves, net worth, and other accounts, the future understanding and interpretation of which are, at least in part, dependent on the auditor's accumulation of information concerning them.

• Carryback

  The amount, for federal income tax purposes, of the net (operating) loss for a given year of an individual, corporation, or other taxpayer carrying on a business, subject to certain adjustments, that may be deducted from the net income of three preceding years.

• Carrying Charge

  A recurring cost incident to the possession or ownership of property, usually regarded as a current expense but occasionally added to the cost of an asset held for ultimate disposition where the market or likely disposal proceeds are judged to be sufficient to absorb the cost thus enhanced.

• Carrying Value

  The amount at which a property is recorded on the books, net of depreciation, if any; book value.

• Carryover

  The amount, for federal tax purposes, of the net (operating) loss for a given year of an individual, corporation, or other taxpayer conducting a business, subject to certain adjustments, that to the extent not absorbed as a carryback may be deducted from the taxable income of succeeding years.

• Cash Basis

  Recordkeeping method whereby notation is made only of cash received and cash disbursed.

• Cash Discount

  A deduction from the original amount owed by a customer for prompt payment of an invoice.

• Cash Flow

  A tracing, in successive steps, of individual items, or of aggregates of income or expenditure, from their first recognition in the accounts to their final disposition or loss of identity.

• Cash Receipts

  Money that actually arrived: checks, card batches, ACH, and currency. Collections, not unpaid invoices.

• Cash Statement

  A statement rendered periodically, often daily, to the management, usually showing the opening and closing balances of cash on hand and in each bank, a summary of the receipts and disbursements of the period or day, and particulars of deposits and withdrawals.

• Cash-Disbursement Journal

  A journal in which are entered individual disbursements or blocks of disbursements as they occur.

• Cash-Flow Statement

  A statement of cash income and outgo between two given dates, its components often identified with items appearing in balance sheets and income statements.

• Cash-Receipts Journal

  A journal in which cash receipts are entered chronologically.

• Cashier's Check

  Bank draft made by a bank on its own account.

• Certificate of Incorporation

  A document issued by a state establishing a corporation.

• Certified Check

  Check backed by the bank's guarantee of payment.

• Changes in Financial Position

  Differences in the sources and uses of working capital during a stated period of time.

• Charge Off

  (verb) To treat as a loss; to write off; to designate as an expense or loss an amount originally recorded as an asset.

• Chargeoff

  (noun) The elimination by a transfer to expense of a portion or all of the balance of an account in recognition of the expiration of any continuing value.

• Chart of Accounts

  Systematic arrangement of the accounts for a business, generally listed according to assets, liabilities, capital, income, cost, and expenses.

• CIF

  Cost, Insurance, and Freight; a term indicating that the quoted price of an object of sale includes charges for handling, insurance, and freight up to delivery to a foreign port, beyond which the purchaser must assume any further handling, insurance, and transportation charges.

• CIF Price

  Same as Cost & Freight price, except that the seller includes the cost of marine insurance.

• Clearing Account

  A primary account containing costs that are to be transferred to other accounts.

• Close

  (the books) To transfer the balance of revenue and expense accounts at the end of an account period directly, or through a profit-and-loss (or clearing) account, to retained earnings or to another proprietorship account or accounts, so that only balance-sheet (asset, liability, and net worth; = real) accounts remain open on the general ledger.

• Close Corporation

  A corporation with a comparatively small number of stockholders, all of whom participate in the conduct of its affairs.

• Closing Entries

  Entries made at the end of the financial period to close all temporary income, cost, and expenses and to transfer the net profit (or loss) to the capital accounts.

• Closing the Ledger

  At the end of a specific period, the procedure for closing income, cost, and expense accounts, and transferring the profit or loss to the capital accounts.

• Closing Trial Balance

  A trial balance of the general ledger at the end of a period, after eliminating the income, cost, and expense accounts.

• COD

  Cash (or Collect) on Delivery.

• Common Stock

  Stock, the ownership of which confers no special privileges; owners of such stock prevail after the company's liabilities and other proprietary claims have been satisfied.

• Comparative Balance Sheet

  Two or more balance sheets of the same organization with different dates, or of two or more organizations with the same date, customarily displayed in parallel columns to facilitate the observation of variances.

• Compensatory (or compensating) Balance

  The portion of the balance in the commercial checking account of a borrower (e.g., equal to 20% of a credit line or amount borrowed) which, under an agreement or informal understanding between borrower and bank, may not be withdrawn.

• Compound (journal) Entry

  A journal entry having three or more elements and often representing several transactions.

• Consignment

  Goods shipped for future sale; title remaining with shipper, to be sold for the account of the shipper.

• Consolidated Balance Sheet

  A balance sheet in which the assets and liabilities of a controlling company are combined with the corresponding items of the organization it owns or controls in such a manner as to disclose the financial portion of the related companies as though they were a single economic unit.

• Consolidated Financial Statement

  A statement showing financial condition or operating results of two or more associated enterprises as they would appear if they were one organization.

• Consolidated Income Statement

  A statement combining the income statements of two or more associated enterprises as a single economic unit.

• Contingent Asset

  An asset, the existence, value, and ownership of which depends upon the occurrence or nonoccurrence of a specified event or upon the performance or nonperformance of a specified act.

• Contingent Fund

  Assets set apart for use in contingencies, usually of a specified character.

• Contingent Liability

  A possible liability.

• Contra Account

  One or two or more accounts that partially or wholly offset another or other accounts: on financial statements, they may either be merged or appear together.

• Contra Entry

  An item on one side of an account that offsets, fully or in part, one or more items on the opposite side of the same account.

• Contributed Capital

  The payments in cash or property made to a corporation by its stockholders (a) in exchange for capital stock, (b) in response to an assessment on the capital stock, or (c) as a gift; paid-in capital; often, though not necessarily, equal to capital stock and paid-in surplus.

• Contribution Margin

  Marginal income.

• Controllable Cost

  Cost that varies with volume, efficiency, choice of alternatives, and management determinations generally; variable cost.

• Controlling Account

  A general ledger account; the balance of this account equals the sum of the balances of the accounts in the subsidiary ledger.

• Corporation

  An entity created to do business in a state through its charter.

• Cost Absorption

  The expensing of an added cost, such as freight, not passed on to a customer, replacement or repair under a guarantee of quality or period of performance.

• Cost Allocation

  The transfer of the cost of a good or service or the total of a group of such costs from a primary account to one or more secondary accounts, the purpose being to identify the cost with the product or other cost objective to which the goods or services have contributed.

• Cost and Expense Accounts

  Those accounts that record the cost of items needed for a business to manufacture, sell, or operate.

• Cost Basis

  The valuation basic followed in recording and reporting expenditures.

• Cost Center

  An organizational division, department, or unit of machines, manpower, or both, having common supervision.

• Cost Ledger

  A subsidiary ledger containing accounts used in computing or summarizing the cost of goods manufactured or services produced.

• Cost of Goods Purchased

  The purchase price of goods bought, plus the cost of storage, transportation, and delivery to the point where they are to be used, and other costs pertaining to their procurement and receipt.

• Cost of Sales

  The total cost of goods sold during a given accounting period, determined by ascertaining, for each item of sale, the invoice and such other costs pertaining to the item as may have been included in the cost of goods purchased.

• Cost or Market, Whichever is Lower

  The lesser of cost price or market value.

• Cost Recovery

  The recapture of cost through expense recognition; cost absorption.

• Cost Sheet

  A statement showing a summation of the elements entering into the cost of a product.

• Cost Standard

  A predetermined cost estimate, as of a product, with which actual cost performance may be compared.

• Cost System

  A system of accounts, often subsidiary to the general ledger, by means of which the cost of products, processes, or services is determined.

• Cost Unit

  The quantity or amount selected as a standard for the measurement of the cost of a given product or operation.

• Cost-Plus

  A term indicating a method of determining the selling price of goods produced or services performed under a contract whereby the cost of the goods or service is increased in the amount of a profit equal to an agreed increment to such cost.

• Cost-Plus Pricing

  The practice of determining selling price by adding a profit factor to costs.

• Cost-Recovery Basis

  A method of accounting for the sale or other disposal of an asset whereby credits are made against the cost of the assets as proceeds of the sale or liquidation are received or realized.

• Cr.

  "Credit."

• Credit

  The ability to buy or borrow in consideration of a promise to pay within a period, sometimes loosely specified, following delivery.

• Credit Line

  An agreement by a bank, usually informal and of indefinite span, to make a loan, not to exceed a specified amount, when needed by a customer.

• Credit Memorandum

  Document whereby a buyer receives notice of credit granted by the seller.

• Credit Sale

  The delivery of goods, or the performance of a service, accompanied by the receipt of a promise to pay.

• Creditor

  One who is owed a debt of money or services.

• Creditors Ledger

  A ledger containing accounts with creditors listed.

• Creditors' Equity

  The collective amount of liabilities or amounts owing to outsiders other than stockholders.

• Crosscheck

  To add horizontally as well as vertically in order to assure the accuracy of totals.

• Current Account

  A running account, usually between two related companies, reflecting the movements of cash, merchandise, and other items in either or both directions; a periodic settlement is not usually required; it may differ from an account current.

• Current Asset

  Assets that normally will be converted into cash within the year or sooner.

• Current Expenditure

  An expenditure covering a current operating cost during a given period.

• Current Expense

  An expense of a given period.

• Current Income

  Income of a given accounting period.

• Current Investment

  An expenditure for readily marketable securities having as its purpose the profitable use of cash temporarily in excess of immediate requirements; temporary investment.

• Current Liability

  The short-term debt of a business, normally payable within a year or sooner.

• Current Ratio

  Current assets divided by current liabilities.

• Customers Ledger

  A ledger containing accounts with customers listed.

D

• Daybook

  A chronological record of business transactions day by day; a blotter; a business diary.

• Debit

  The goods or benefit received from a transaction; a bookkeeping entry or posting recording the creation of, or addition to, an asset or an expense, or the reduction or elimination of a liability, credit valuation account, or item of net worth or revenue.

• Debit Memorandum

  A document, other than an invoice, showing the reason and authority for creating a debit.

• Debit Service

  The payment of matured interest and principal.

• Decentralize

  To delegate authority to subordinate levels within an administrative hierarchy, and to fix areas of responsibility.

• Deduction

  Reasoning for which there is a necessary conclusion, i.e., a conclusion completely implied by the premises.

• Deferred Expense

  Prepaid expense for items not used all at once; e.g., insurance.

• Deferred Income

  Income received in one period and not earned until a later period, e.g., subscription revenue.

• Deferred Income Tax

  Estimated income tax on the excess of net revenues, recognized for accounting purposes, over that reported for tax purposes.

• Deferred Liability

  A debt, the payment of which is deferred beyond a legal or customary date; e.g., a deferred tax.

• Deferred Payment Sale

  An installment sale.

• Deficiency Account

  (or statement) A statement account for an estimated or accrual loss to creditors and owners, usually prepared by creditors of a financially embarrassed debtor in connection with a statement of affairs in the course of bankruptcy proceedings or at the close of an investigation.

• Deficit

  Debit balance occurring when losses exceed income.

• Deficit Account

  A ledger account for a deficit; an earned-surplus account with a debit balance.

• Demand Deposit

  A deposit in a financial institution, such as a bank, that may be withdrawn without notice; a commercial checking account.

• Depleted Cost

  Residual cost after deducting accrued depletion. The term is applied to mineral, coal, oil, natural-gas, and timber properties.

• Depletion

  The exhaustion of a natural resource: applied to an oil or mineral deposit, standing timer, and the like.

• Depreciation

  Wear and tear of a fixed asset which decreases its value.

• Depreciation Expense

  That portion of the cost or other basis of a fixed asset or fixed-asset group charge against the operations of an accounting period.

• Depreciation Rate

  A percentage that when applied to the depreciation base, will yield depreciation expense for a year.

• Detailed Audit

  An examination of the books of account or a portion thereof, whereby all or substantially all entries and transactions are reviewed and verified, as contrasted with the more usual examination by means of tests or samples.

• Differential Cost

  Marginal cost; see incremental cost.

• Direct Cost

  The cost of any good or service that contributes to and is readily ascribable to product or service output, any other cost incurred being regarded as a fixed or period cost.

• Direct Costing

  The process of assigning costs as they are incurred to products and services.

• Direct Labor

  Labor costs specifically traceable to the product.

• Direct Overhead

  Factory, selling, or other expense attributed solely to a certain product, and thus constituting a direct cost.

• Disclosure

  An explanation, or exhibit, attached to a financial statement, or embodied in a report (e.g., an auditor's) containing a fact, opinion, or detail required or helpful in the interpretation of the statement or report; an expanded heading or a footnote.

• Discount Lost

  A cash discount on a purchase, not taken advantage of because of failure to pay before the expiration of the discount period.

• Discount on Sales or Purchases

  An allowance given for the settlement of a debt before it is due.

• Distort

  To create a false impression or give a limited perspective.

• Dividend

  Profit distribution to stockholders.

• Double-Entry Bookkeeping

  A system of recording each business transaction by means of a two-way, self- balancing entry.

• Dr.

  debit.

• Draft

  A written order by one party ordering a second party to pay a third party.

• Drop Shipment

  A shipment from a manufacturer or supplier sent directly to the customer of a distributor or other supplier without passing through the hands of the latter.

E

• Earned Income

  Income derived from personal services rendered as distinct from other kinds of income.

• Earned Surplus

  Recording of accumulated profits of a corporation in an account.

• Earnings Per Share

  (of common stock) Net income of a stated period, less preferred-stock requirements, divided by the number of common shares outstanding at the end of the period.

• Earnings Statement

  Income statement; any analysis or presentation of earnings in statement form.

• EBITDA

  Profit from operations before interest, taxes, depreciation, and amortization.

• Effective Pay Rate

  The rate of pay (e.g., weekly) determined after adding back deductions from basic pay (e.g., withholding and Social Security taxes) and including insurance and other fringe benefits not deducted from basic pay.

• Efficiency Variance

  A variance resulting from causes other than a change in the price or direct costs or of materials or labor.

• Embezzlement

  To appropriate fraudulently to one's own use, as money or property entrusted to one's possession.

• Employee Liabilities

  Bonuses, deferred compensation, pension, retirement grants or other amounts held for eventual payments to employees of cash or capital stock, often appearing on balance sheets between long- term obligations and stockholders' equity.

• Encumbrance

  Term in governmental accounting to designate an anticipated expenditure, evidenced by a contract or purchase order, or determined by administrative action.

• Entity

  A division of the activities of a natural person, partnership, corporation, or other organization, separate and complete in form, usually distinguished from a larger identity such as a head office, controlling corporation, or other more inclusive economic unit; an establishment.

• Entry

  Item in a recording of a business transaction.

• EOM

  End of Month.

• EOY

  End of Year.

• Equity

  Any right or claim to assets; a liability

• Equity Capital

  Proprietorship; net worth; stockholders' equity.

• Equity Financing

  The sale of capital stock by a corporation for cash or items of value.

• Exchange Gain (or loss)

  The net result in local currency of any completed deal in foreign currency.

• Executory Lease

  An obligation calling for the payment of rentals of real or personal property over a period of one year.

• Exemption

  In federal income taxes, a deduction from gross income allowed an individual, in the nature of a specific minimum or token amount, for his own support and that of his family.

• Expected Life

  Expected value of length of life or years of services of an asset or asset group at a particular moment of time.

• Expenditure

  The incurring of a liability, the payment of cash, or the transfer of property for the purpose of acquiring an asset or service or settling a loss.

• Expense

  Expenditure for operating cost of a present or past period.

• Extraordinary Depreciation

  Depreciation caused by unusual wear and tear, unexpected disintegration, obsolescence, or inadequacy beyond that attributable to ordinary loss of physical or service life.

• Extraordinary Expense

  An expense so unusual in type or amount as to be accorded special treatment in the accounts or separate disclosure in financial statements.

F

• F.O.B

  Free on board.

• F.O.B. Price

  The price charged at a specific location.

• Face Amount

  The sum of money on a check, bond, note, or other instrument.

• Factor

  One who buys trade receivables with or without recourse, his profit coming from a commission, such as a fraction of one percent, and from interest on advances against receivables.

• Factor Ledger

  A subsidiary ledger containing such operating costs of a manufacturing establishment as materials, labor, and factory overhead.

• Factory Cost

  Manufacturing cost.

• Factory Expense

  An item of manufacturing cost other than raw material and direct labor.

• Fair Market Value

  Value determined by bona fide bargaining between well-informed buyers and sellers, usually over a period of time.

• Fair Value

  Reasonable or equitable value; the legal concept of value on which an investor is entitled to a "fair return."

• Fiduciary

  Any person responsible for the custody or administration, or both, of property belonging to another; as, a trustee.

• Fiduciary Accounting

  The preparation and keeping of accounts for property in the hands of a trustee, executor, or administrator, whether under the direct jurisdiction of a court or by virtue of a private deed of trust or other instrument of appointment.

• FIFO

  First in, first out, term used in costing of inventory; oldest acquisitions are disposed of first.

• Financial Accounting Standards Board (FASB)

  A quasi-independent organization established in 1973 by the AICPA-Sponsored Financial Accounting Foundation for the purpose of developing principles for financial reporting by business enterprise.

• Financial Reporting

  The package of statements (profit and loss, balance sheet, and often cash flow) produced from a closed ledger.

• Financial Statement

  A representation of financial data at a specific period of time.

• Financial Transaction

  An event that changes what the business owns, owes, or has earned, recorded as a journal entry or source document.

• Finished Goods

  Goods that have been converted from raw materials into the form in which they can be used or sold.

• First In, First Out (FIFO)

  The inventory that is acquired earliest is assumed to be used first; the inventory acquired latest is assumed to be still on hand.

• Fiscal Period

  Accounting period.

• Fiscal Year

  Period of a year that is not a calendar year (not ending in December).

• Fixed Assets

  Assets with a useful life of more than one year.

• Fixed Charges

  Unavoidable overhead, particularly interest costs, depreciation, amortization of intangibles and of discount on funded debt, and rent of leased property.

• Fixed Cost (or expense)

  An operating expense, or operating expense as a class, that does not vary with business volume.

• Fixed Liability

  Long-term liability.

• Fixed-Asset Schedule

  A summary, by classes, of fixed assets, such as that sometimes appearing in annual reports to stockholders.

• Flexible Budget

  A budget containing alternative provisions based on varying rates of production or other measures of activity.

• Floating Asset

  Current asset.

• Floating Debt

  Current or short-term obligations; current liabilities.

• Floating Liability

  Current liability; floating debt.

• Folio

  A reference to a page number for the source of an entry or posting.

• Footnote

  (appended to a financial statement) A medium for imparting additional information, usually a narrative, indexed to a particular item.

• Forward Accounting

  The areas of interest in the preparation of standard costs, budgeted costs and revenues, estimates of cash requirements, breakeven charts, and projected financial statements – and the various studies required for their estimation; also the internal controls regulating and safeguarding future operations. Also, permission granted by a manufacturer to a distributor or retailer to sell his products.

• Franchise

  A privilege, granted by governmental authority, sanctioning a monopoly or permitting the use of public property, usually subject to regulation.

• Freight

  A charge by a carrier for the transportation of goods.

• Freight Absorption

  The practice of a seller of not charging the customer with freight out.

• Freight-In

  Freight paid on incoming shipments, treated as an element of cost of goods or materials received, or refunded by the seller or deducted on his invoice, according to custom or the terms of sale.

• Full Absorption Costing

  The inclusion of all fixed and variable production costs in work-in-progress and output costs; contrasts with direct costing.

• Fund

  An asset or group of assets within any organization, separated physically or in the accounts or both from other assets and limited to specific uses.

• Fund Accounting

  In governmental and institutional accounting in terms of a sum of money and, often, other assets as well, constituting a separate accounting entity, created and maintained for a particular purpose and having transactions subject to legal or administrative restrictions.

G

• GAAP

  Generally accepted accounting principles.

• Gain

  Any pecuniary benefit, profit, or advantage, as opposed to a loss; revenue or income; as in the phrase "gain or loss."

• Gain or Loss

  The net result of a concluded transaction or group of transactions or the transactions of an operating period, following the application of usual accounting rules or rules appearing in income tax regulations.

• General expense (or burden)

  Administrative expense.

• General Journal

  The catch-all book of original entry for transactions that do not belong in a sales, cash, or purchases journal.

• General Ledger

  Summarized accounts; all the transactions of a business.

• Going Concern

  Any enterprise that is expected to continue operating indefinitely in the future; hence, its collective assets, liabilities, revenues, operating cost, personnel, policies, and prospects; a basic axiom essential to the accounting and reporting of business transactions.

• Goods and Services

  The end products of expenditures; the initial distribution of incurred costs.

• Goods in Process

  Partly finished goods.

• Goodwill

  The gross value of a business exceeding the book value.

• Governmental Accounting

  The principles, customs, and procedures associated with the accounting for municipal, state, and national governmental units.

• Gross

  Undiminished by related deductions, except corrections; applied to sales, revenues, income, expense, and the like.

• Gross (merchandise) Margin

  Retail accounting term signifying net sales, less merchandise costs.

• Gross Book Value

  The dollar amount at which an asset appears on the books, before deducting any applicable accumulated depreciation or other valuation account.

• Gross Earnings

  Gross income.

• Gross Income

  Revenues before deducting any expenses; an expression employed in accounting for individuals, financial institutions and the like.

• Gross Loss

  The excess of the cost of goods sold over the amount of sales; "negative" gross profit.

• Gross Margin

  The excess of sales over direct costs of products sold.

• Gross Profit

  Net sales less cost of goods sold.

• Gross Sales

  Total sales, before deducting returns and allowances but after deducting corrections and trade discounts, sales taxes, excise taxes based on sales, and sometimes cash discounts.

• Guarantor

  One who promises to make good if another fails to pay or otherwise perform an assigned or contractual task.

H

• Historical Cost

  Cost to the present owner at the time of acquisition.

• Holding Period

  In federal income taxes, the period during which an asset is owned; a period of importance in the determination of whether sales of securities are wash (-sale) transactions and whether profits from the sale of capital assets are to be taxed as long-term or short-term capital gains.

• Honor

  To accept a monetary instrument when it is presented for payment.

I

• Imprest Cash Fund

  A petty cash fund restored to its beginning amount by a transfer from the general cash account of an amount equal to the sum of disbursements.

• Imputed Interest

  The return on capital assumed to be a part of the net income of an enterprise.

• In Short

  In an adjacent and subordinate column, usually at the left: said of supporting details for which a total appears in any accounting or statistical schedule or table.

• Income

  Money or money equivalent earned or accrued during an accounting period, increasing the total of previously existing net assets, and arising from sales and rentals of any type of goods or services, commissions, interest, gifts, recoveries from damage, and windfalls from any outside source; a generic term.

• Income Account

  Any account maintained for a particular item of revenue or income.

• Income Statement

  A summary of the revenues and expenses of an accounting unit, or group of such units, for a specified period.

• Incremental Cost

  The change in aggregate cost that accompanies the addition or subtraction of a unit of output, or a change in factors affecting cost, such as style, size, or area of distribution; marginal cost.

• Incurred Cost

  A cost arising from cash paid out or obligation to pay for an acquired asset or service, a loss from any cause that has been sustained and has been or must be paid for.

• Indebtedness

  A debt owing; any liability; an aggregate of liabilities.

• Indirect Cost

  A functional cost not attributed to the production of a specified good or service but to an activity associated with production generally; a variety of factory costs, such as supervision, building depreciation, maintenance, heat and light, and general administrative and selling expense.

• Indirect Expense

  Indirect cost; manufacturing cost; overhead.

• Indirect Labor

  Labor not directly applicable to the manufacture of goods.

• Indirect Liability

  An obligation not yet incurred but for which responsibility may have to be assumed in the future; e.g., possible liability from the premature settlement of a long-term contract.

• Indirect Material

  Materials not entering directly into a product; the cost of such material.

• Indorsement

  The payee's name signed on the back of a negotiable instrument.

• Installment

  Any part payment on a debt.

• Installment Method of Accounting

  A method of recording revenue from an installment sale whereby the gross profit from the sale is recognized in any fiscal year in proportion to the portion of the total selling price collected in cash during that year.

• Installment Sale

  A sale of real or personal property paid for in a series of equal amounts over a period of weeks or months.

• Insurance Premium

  The amount paid to an insurance company for protection against certain losses.

• Intangible

  Any "two-dimensional" or "incorporeal" asset; any asset other than cash or real estate; in this sense used by some tax authorities.

• Intangible Value

  The value of an enterprise in its entirety, as a going concern, in excess of the value of its net tangible assets.

• Interest

  The charge made for the privilege of using borrowed money.

• Internal Control

  The general methodology by which management is carried on within an organization; also, any of the numerous devices for supervising and directing an operation or operations generally.

• Inventory

  Raw materials and supplies, goods finished and in process of manufacture, and merchandise on hand, in transit and owned, in storage, or consigned to others at the end of an accounting period.

• Inventory Accounting

  How you value stock on the balance sheet and move cost of goods sold when you sell it.

• Inventory Control

  The control of merchandise, materials, goods in process, finished goods, and supplies on hand by accounting and physical methods.

• Inventory Turnover

  The number of times that the investment in merchandise or stocks on hand is replaced during a stated period, usually 12 months.

• Inventory Valuation

  The determination of the cost or the portion of cost assignable to on-hand raw materials, goods in process, finished stock, merchandise held for resale, and supplies.

• Invoice

  A document stating the quantity, price, terms, and other particulars of goods or services sold.

• Issued Capital (stock)

  That part of a corporation's authorized capital stock represented by certificates legally issued for cash or other consideration, whether or not such certificates are in the hands of the public or have been reacquired by the issuer.

J

• Joint Tenant

  Any one or two or more persons who together own real or personal property, whereby, upon the death of any one of them, the interest of the deceased person passes to the other joint tenant(s) without becoming a part of the estate of the deceased person.

• Journal

  The chronological book of original entry: the dated list of transactions before they post to the ledger.

• Journal Entry

  Recording of a business transaction.

L

• Lapse

  To expire or be forfeited; said of an insurance policy and the rights and benefits under it, upon expiration of the policy or upon cancellation for nonpayment of premium.

• Legal Liability

  A responsibility for some obligation, enforceable as law, as distinguished from a moral responsibility.

• Letter of Credit

  Authorization by a bank to draw on it for funds, within a stated amount and time.

• Liability

  An amount owed by one person (debtor) to another person (or creditor).

• Liability Services

  Accrued liability.

• Life Annuity

  An annuity the payment of which ceases on the death of the beneficiary.

• LIFO

  Last in, first out; an inventory valuation method.

• Limited Partnership

  A partnership in which one or more partners have a restricted liability to creditors of the partnership.

• Limited-Life Asset

  Any capital asset.

• Line of Credit

  Credit line. A maximum credit amount allowed a buyer or borrower.

• Liquid Assets

  Current assets or assets that can be quickly converted to cash.

• Liquidation

  Payment of debt.

• List Price

  The published price.

• Long-Term Debt

  Term on balance sheet signifying debt due after one year.

• Long-Term Liability

  An obligation that will not become due until after a period of time, usually a year.

• Lump-Sum Purchase

  The acquisition of a group of assets for an indicated figure, without breakdown by individual assets or classes of assets.

M

• Manufacturing Expenses

  All costs of manufacturing, not including raw materials and labor costs.

• Margin

  Gross profit.

• Marginal Balance

  The excess of revenue over variable cost.

• Marginal Cost

  The increase or decrease in total cost which occurs with a small variation in output.

• Marginal Income

  The excess of sales over related direct costs; the contribution of revenues to other costs and profit.

• Marketable Securities

  A balance-sheet title for negotiable stocks, bonds, and Treasury securities carried as a current asset.

• Matching

  The principle of identifying related revenues and expenses within the same accounting period.

• Materiality

  The relative importance, when measured against a standard of comparison, of any item included in or omitted from books of account or financial statements, or of any procedure or change in procedure that conceivably might affect such statements.

• Maturity Date

  Due date of an obligation.

• Merchandise Inventory

  List of goods on hand.

• Merchandise Turnover

  Frequency at which the inventory is sold during the financial period.

• Mortgage Bond

  One of an issue of bonds secured by a mortgage against specific properties of the issuer.

N

• Negotiability

  State whereby a negotiable investment may be transferred from one person to another.

• Negotiable Instrument

  A written promise in the form of a note or draft, specifying that a sum of money will be paid at a specific time to a specific person.

• Net Book Value

  The difference between the gross amount of an asset or asset group as shown in the books of account and any reserve or other applicable offset, such as accumulated depreciations. See book value.

• Net Income

  The profit left after you subtract all expenses from revenue.

• Net Operating Profit

  Operating income.

• Net Profit

  Net revenue minus expenses and costs.

• Net Sales

  Gross sales minus returns and allowances.

• Net Worth

  The total appearing on the accounting records of the equities representing proprietary interests. The going-concern value of assets over liabilities.

• No-Par Value Stock

  Stock that has no par or nominal value.

• Non-Par-Value Capital Stock

  Capital stock having no specified par or nominal value.

• Noncumulative Dividend

  A dividend on preferred stock, that if passed, does not have to be made up at a later date.

• Note Register

  Ledger containing a record of notes receivable and notes payable.

O

• Offset

  An amount equaling or counter-balancing another amount on the opposite side of the account or statement.

• Offset Account

  An account acting as an offset, in whole or in part, to another account; an absorption account.

• On Consignment

  Consigned to another for the purpose of sale, display, or other use.

• Opening Entry

  At the time books are opened, entries made to record the present assets, liabilities, and capital of a business.

• Operating Expenses

  The expenses a business incurs in its operation.

• Operating Ledger

  A ledger containing only nominal accounts.

• Opportunity Cost

  Prospective change in cost following the adoption of an alternative machine, process, raw material, specification, or operation.

• Original Cost

  Primary cost.

• Overhead

  Any cost of doing business other than a direct cost of an output of product or service.

• Overhead Pool

  A group of indirect costs the total of which are figured by any of various methods, that is or may be spread over intermediate and final-product stages of production.

• Overhead Rate

  A standard rate at which overhead is allocated.

• Owner's Equity

  Net worth.

P

• Paid-In Surplus

  An excess over par or stated value received from the sale or exchange of capital stock.

• Paid-Up Capital

  The amount of money received from stockholders for capital stock issued, equivalent to the total of the par or stated value.

• Par Value

  The face amount of capital stock or other securities when issued.

• Partnership

  Arrangement whereby two or more people or entities merge forces so that each will benefit, with profits and losses shared jointly.

• Period Cost (or charge or expense)

  Any expenditure assigned to expense on a time basis.

• Perpetual Budget

  Continuous budget.

• Perpetual Inventory

  A book inventory kept in continuous agreement with stock on hand by means of a detailed record that may also serve as a subsidiary ledger where dollar amounts as well as physical quantities are maintained.

• Personal Holding Company

  Term in federal income taxes specifying a corporation, popularly known as an "incorporated pocketbook," a majority of the outstanding capital stock of which is owned by a small group of persons.

• Petty Cash Fund

  Cash used for small out-of-pocket expenses.

• Physical Inventory

  Merchandise on hand, determined by actual count, weight, or measurement.

• Pledged Asset

  An asset placed in trust or mortgaged to secure an obligation or contract.

• Post Closing Balance Sheet

  A balance sheet, the details of which are supported by the open balances of the general ledger accounts at the end of a fiscal year, after year-end, and audit adjustments have been recorded and revenue and expense (nominal) accounts have been closed out.

• Post Closing Trial Balance

  Trial balance as determined upon closing the ledger.

• Posting

  Transferring entries from journals to ledgers.

• Power of Attorney

  An instrument authorizing one person to act as agent for another, either generally or for some specified purpose.

• Preclosing Trial Balance

  A trial balance prepared before giving effect to final adjusting and closing entries.

• Preferred (Stock) Dividend

  Dividend paid to holders of preferred stock.

• Preferred Stock

  Type of stock that takes precedence over common stock when dividends are distributed in case of dissolution.

• Premium on Bonds and Capital Stock

  The price paid for capital stock or bonds in excess of the par face or stated value.

• Premium on Capital Stock

  The amount in excess of par or stated value received by an issuing corporation for its capital stock; paid-in surplus.

• Prepaid Expense

  A type of deferred charge.

• Prepaid Income

  Deferred revenue.

• Prepaid Interest

  The excess of the face value of a loan over the proceeds of the loan.

• Price Margin

  Gross margin.

• Price Variance

  Change in the price of materials or labor.

• Prime Rate

  The rate of interest charged by commercial banks on loans to preferred customers.

• Principal

  A sum of money borrowed on which interest is calculated.

• Proceeds

  The amount of cash, other assets, and services received from the sale or other disposition of property.

• Processing Cost

  Manufacturing cost.

• Profit and Loss Statement

  The difference between income and expenses of a business for a period and the profit (or loss) resulting therefrom.

• Proforma

  A term applied to a balance sheet or other statement that contains assumed figures and facts. Proformas are used for budgeting and making business decisions.

• Promissory Note

  A written promise to pay a certain sum of money on a specified date.

R

• Raw Materials

  Component part of finished goods.

• Real Account

  A ledger account, the balance of which is carried forward into a succeeding fiscal period.

• Realized Depreciation

  Recapture of depreciation.

• Receivable

  Collectible, whether or not due.

• Receiver

  A person appointed by a court to take charge of property pending its disposition.

• Reconciliation of Bank Statement

  The process of balancing and accounting for the difference between the bank balance, and the balance shown by the depositor's records.

• Recovery Cost (or expenditure)

  Residual cost.

• Repurchased Stock

  Reacquired capital stock that has been bought from stockholders.

• Reserve for Bad Debts

  An account set up on the books to record amounts charged to earnings against which actual bad debt losses are to be charged.

• Reserve for Depreciation

  Record of the accumulation of periodic depreciation charges.

• Residual Cost

  Recoverable cost of an asset.

• Retail Method

  A method of maintaining a book inventory by which the cost of sales and inventories of department stores and other retail stores are determined at the close of intermediate accounting periods without a physical stocktaking.

• Revenue

  The money a business earns from selling goods or services, before subtracting expenses.

• Revenue Bond

  Term in municipal accounting specifying one of an issue of bonds by a governmental unit for the purpose of financing the construction or purchase of, or additions to, income-producing enterprises.

• Reversal Entries

  General journal entries made at the beginning of a new fiscal period to reverse entries for deferrals and accruals made at the close of the preceding fiscal period, in order that income and expense accounts affected may reflect the actual income and expense for the current fiscal period.

S

• Sale Value

  The price at which an asset of any kind can be sold, less whatever cost is yet to be incurred.

• Scrap Value

  Salvage worth.

• Secured Creditor

  A person whose claim against another is protected by collateral or by a mortgage or other lien.

• Share

  One of the units of equal value into which each class of the capital stock of a corporation is divided.

• Sight Draft

  A draft to be paid at the time it is presented to the drawee.

• Sole Proprietorship

  A business owned by one person.

• Special Journals

  Specific journals such as a sales journal, purchase journal, or cash receipts journal that are used to record only those types of transactions.

• Spread Sheet

  A worksheet providing a two-way analysis or recapitulation of costs or other accounting data.

• Standard Cost (cost accounting)

  A forecast or predetermination of what actual costs should be under projected conditions, serving as a basis of cost control and as a measure of productive efficiency.

• Statement of Account

  Summary of transactions between seller and buyer, reporting the unpaid balance at that time period.

• Stock

  Shares issued by a corporation, evidenced by formal certificates representing ownership in the corporation. The total amount of shares is known as the Capital Stock of the corporation.

• Stock Certificate

  Document of evidence of ownership in a corporation.

• Stockholder

  The owner of shares of the capital stock of a corporation.

• Subsidiary Ledger

  Supporting ledger consisting of a group of similar accounts, the total of which is in agreement with a controlling account in the general ledger.

• Surplus Reserve

  Part of the surplus set aside for some specific purpose; restricted retained earnings.

T

• T-Account

  A form of account often used for demonstrating the effect of a transaction or series of transactions, or for solving short accounting problems.

• Tangible Assets

  Physical assets; assets other than intangibles.

• Terms

  Conditions of payment.

• Time Draft

  A draft payable within a specified time period.

• Trade Acceptance

  The sale of goods on terms drawn by the seller and accepted by the purchaser.

• Trade Discount

  A discount from a list price.

• Treasury Stock

  Capital stock reacquired by the issuing corporation.

• Trial Balance

  A list of all open account balances in the ledger and their balances which may be prepared at any time.

U

• Unrecovered Costs

  Uninsured losses resulting from extraordinary obsolescence, fire, theft, or market fluctuations.

• Useful Life

  Normal operating life span.

V

• Voucher

  Written evidence of a payment or entry.

• Voucher System

  A system for recording every payment including merchandise, services, supplies and fixed assets by preparing vouchers for each payment to be signed by an authorized person.

W

• Work Sheet

  The collection and classification of data used in preparing financial statements.

• Working Capital

  Capital currently used to operate the business. The excess of current assets over current liabilities.

• Write Down

  To transfer a part of the balance of an asset account to an expense account or to profit and loss.

• Write Off

  To transfer the balance of an account previously regarded as an asset to an expense account or profit and loss.

• Write Up

  To record an increase in the book value of an asset, not represented by an outlay of cash or other property or an inflow of capital.