Receivables & Bad Debt
Money that a business expects not to collect from customers.
Uncollectible Accounts
The original amount of money borrowed or invested.
Principal
The amount due at the end of a note, including principal and interest.
Maturity Value
The inventory method that assumes the earliest goods purchased are the first sold.
First-In, First-Out (FIFO)
Total depreciation recorded for an asset since it was purchased.
Accumulated Depreciation
The method that records bad debt expense only when an account is determined to be uncollectible.
Direct Write-Off Method
The dollar amount stated on the face of a note or bond.
Face Value
Revenue that has been earned but not yet received in cash.
Accrued Revenue
The inventory method that assumes the most recently purchased items are sold first.
Last-In, First-Out (LIFO)
A depreciation method that allocates an equal amount of expense each year.
Straight-Line Method
The method that estimates bad debts and matches expenses to revenues.
Allowance Method
The cost of borrowing money, usually expressed as a percentage.
Interest
A note that specifically requires the payment of interest.
Interest-Bearing Note
An inventory method that tracks the actual cost of each specific item sold.
Specific Identification Method
A depreciation method that multiplies book value by a constant rate.
Double-Declining Balance Method
A schedule that shows how long accounts receivable have been outstanding.
Aging of Accounts Receivable
The percentage charged for the use of money.
Interest Rate
The cash received when a note is issued, after deductions such as discounts.
Proceeds
An inventory method that calculates a new cost per unit based on the average of available goods.
Weighted Average Method
A depreciation method that allocates expense based on a fraction using the asset’s useful life.
Sum-of-the-Years-Digits Method
The value of an asset after subtracting allowances or depreciation.
Book Value
The date when a note or loan must be repaid.
Maturity Date
The portion of a note that must be repaid at maturity, separate from interest.
Principal
An accounting estimate that spreads the cost of a tangible asset over its useful life.
Depreciation
Profits distributed to shareholders.
Dividends