Financial Terms
A sacrifice of a resource in exchange for a good or service that will provide a future benefit.
What is a cost?
Direct Cost
What is a cost like direct material or direct labor that is directly attached to a product?
Earnings or Income
What is another name for profit?
An expired cost.
What is an expense?
Indirect Cost
What is a cost that needs to "allocated" to a product?
Sales, Gross Margin and Earnings
What does the Income Statement report?
Sales LESS Direct Costs
What is Gross Margin?
Sales Less Direct Costs
What is Gross Margin?
Operating Section, Investing Section, Financing Section
What are the three primary elements of a Statement of Cash Flow?
The idea of recording an expenditure as an asset.
What is capitalization?
To tell a story about company health and performance.
What is the purposes of the financial statements?