This concepts states money is the common measurement unit of economic activity
What is Monetary Unit concept?
100
It Obtains the cash or other resources to pay for investment in long term assets
What is Financial Activities?
100
Business that exists to provide services such as loaning money, finding investors & other services for which it charges fees
What is Service firms?
100
Ratio that measures the return generated per dollar of owners equity
- Net income/ Average owner’s equity
What is Return on owner's equity?
100
This is given to the employees by the company and is included in book balance but not in the bank balance. This is subtracted from the bank balance in the bank reconciliation process.
What is outstanding checks?
200
This concept requires that the success or failure of the business be determined at regular intervals. This means business cannot cease before determining the profits
What is Periodicity Concept?
200
Profit making activities
What is Operational Activities?
200
A firm that obtains & distributes goods to the customers.
What is Merchandising Firms?
200
Ratio that indicates Gross profit of the company
- (sales - Cost of goods sold)/sales
What is Gross margin ratio?
200
This money is in the mail & is included in book balance but not in bank balance. It is added to the bank balance in the reconciliation process
What is Deposits in transit?
300
Concept that requires an accounting system reflect only information about economic events. That is, the business records should be separate from the personal records.
What is Business Entity Concept?
300
Activity that involves purchase & sale of long term assets
What is Investing Activities?
300
Firm that converts raw materials into finished goods
What is Manufacturing firm?
300
Ratio defined as return generated per dollar of total investment
- Net income/ Average Total Assets
What is Return on investment ratio?
300
It is the money given by the bank to the company. This is added to the book balance in the process because the value is not known until the end of the month.
What is Interest earned?
400
It assumes that, absent any information to the contrary, the business entity will continue into the foreseeable future. That is, business is not expected to terminate after each tenure
What is Going Concern Concept?
400
Activity that determines Company's goals and objectives
What is Planning Activities?
400
Organization established for submission of audited, annual financial information for all publicly owned companies. SEC has a legal power to set accounting principles
What is SEC ( security and exchange commision )?
400
Ratio that is a measure of a company’s ability to meet its current obligations as they become due
- (cash+Short Term Investments+Receivables)/Current liabilities
What is Quick ratio?
400
Checks that are subtracted from the book balance. Bounced back check
What is NSF checks?
500
Time spent on activities that add value to the company’s products/ services.
What is Value added Time?
500
It is a set of policies & procedures designed to meet 3 objectives that are promoting operational efficiency, accuracy of accounting info & encouraging management & employee compliance
What is Internal Control process?
500
The set of reporting standards applicable to all U.S companies that issue financial reports for external users
What is GAAP ( Generally accepted accounting principles ) ?
500
Strategy that involves changing market conditions by developing new products/ services, markets and technologies
What is Flexible Strategy?
500
Charges that are subtracted from the book balance in the process because the company doesn't know the money spent on services until the end of the period.