Accounting
What are the two major fields of accounting?
Management accounting, financial accounting
The difference between sales and cost of goods sold is called...
Gross profit
What are the three functions of money?
Medium of exchange, Medium or Unit of value, and store of value
The application of financial principles to money decisions you make is known as...
Personal finance
What is net worth?
Difference between assets and liabilities
What set of standards do US companies follow issued by the Financial accounting standards board (FASB)?
Generally accepted accounting principles (GAAP)
What is an asset that will be used for several years?
Long-term asset
What types of money are included in M2?
Everything in M1 and savings accounts, time deposits
What is the ongoing process of managing you personal finances to meet goals you've set?
Financial planning
A document that has the sources of income and expenditures for a future period to help promote better money habits is a...
Budget
Many companies outside the US follow the rules issued by the International accounting standards board (IASB), which are?
International financial reporting standards (IFRS)
What kind of liabilities do you pay off within a year?
Current liabilities
Who serves as financial intermediaries between savers and borrowers and control the flow of funds?
Financial Institutions
What is stage 1 in the financial life cycle?
Focus on building wealth
What is the difference between budget amount, and actual amount?
Variance
Assets= (liabilities + owners equity) is known as the...
Accounting equation
What shows how much cash is going in and out of the business?
Statement of cash flows
What does the FED use to ensure price stability, economic growth, and full employment?
Monetary policy
A dollar received now is more valuable then a dollar received in the future is an example of what principle?
Time value of money
What type of home loan is used when the interest rate remains the same regardless of changes in the market?
Fixed-rate mortgage
Recognizing revenue as earned only when cash is received, and recognizing expenses only when cash is paid out is an example of...
Cash-basis accounting
What measures a firms efficiency in selling its inventory by looking at both sales and inventory?
Inventory turnover
The stock market is described as a bull market when prices are rising, what is it called when the prices are decreasing?
Bear market
What are the two types of assets?
Monetary assets, and tangible assets
What are the three types of risks related to organizations?
Management, business, and financial risk