Chapter 4
Beginning Inventory plus Net purchases = this
What are Goods Available for Sale?
Results in the highest COGS.
What is LIFO?
Opportunity, Pressure and Rationalization form this.
What is the Fraud Triangle?
Number of units purchased multiplied by per unit cost equals this.
What are Cost of Goods Available for Sale?
This Financial Statement is Revenue minus Expenses.
What is the Income Statement?
Cost of Good Sold plus Ending Inventory equals this.
What is Total Goods Available for Sale?
Goods Available for Sales minus Ending Inventory = this
What is Cost of Goods Sold?
This inventory method tends to smooth out erratic changes in costs.
What is Weighted Average?
Checking Accounts, U.S. Treasury Bill, Currency and Coins are considered this.
What are Cash and Cash Equivalents?
When the bank statement balance and the company's book balance do not agree this must be performed.
What is a Bank Reconciliation?
This financial statement has a beginning balance plus net income minus dividends = ending balance
What is the Statement of Retained Earning?
These are the four Inventory Costing methods.
What is Specific Identification, Weighted Average, FIFO and LIFO?
Net Sales minus Cost of Goods Sold = this
What is Gross Profit?
This inventory method yields the highest gross profit.
What is FIFO?
Loans to employees, accounts receivable and 15 year bonds are not considered this.
What are Cash and Cash Equivalents?
If there is a difference between what the company paid per unit and what it can now be sold for we must adjust for this
What is Lower of Cost or Market?
The owners claim on assets.
What is equity?
This price is not used for Inventory Costing, regardless of the method used.
What is retail price?
Gross Profit - this = Net Income
What are Expenses?
We made the assumption that costs over time behave this way.
What is increase?
This internal control principle does not allow the same employee to request, record and pay for inventory purchases.
What is divide responsibility for related transactions?
Cost of Goods is calculated adding invoice price plus (potentially) one of these
What is shipping, insurance or additional cost to get item ready to sell?
When goods/services are provided to customers this principle is followed
What is the Revenue Recognition Principle?
What is FIFO?
Accounts that receive a credit when payment is made within a discount period.
What are Cash and Merchandise Inventory?
It is a good idea to do this once a year to your inventory.
What is a physical count?
This internal control principal does not allow employees involved in operations perform the only review of internal Controls.
What is perform regular and independent reviews?
When a buyer keeps damaged units for a reduced price this is the journal entry the seller makes.
This principle requires recording of expenses during the same time period as the revenue reported.
What is the Matching Principle?
A jeweler who makes custom pieces would use this Inventory Costing method.
What is Specific Identification?