| A | B |
|---|
| Bank Reconciliation | Report that explains the difference between the book balance of cash and the cash balance reported on the bank statement. (p. 265) |
| Canceled Checks | Checks that the bank has paid and deducted from the depositor's account. (p. 264) |
| Cash | Includes currency, coins, and amounts on deposit in bank checking or savings accounts. (p. 255) |
| Cash Equivalents | Short-term, investment assets that are readily convertible to a known cash amount and sufficiently close to their maturity date so that market value is not sensitive to interest rate changes. (p. 255) |
| Cash Over and Short | Income statement account used to record cash overages and cash shortages arising from errors in cash receipts or payments. (p. 256) |
| Check | Document signed by the depositor instructing the bank to pay a specified amount to a designated recipient. (p. 263) |
| Days' Sales Uncollected | Measure of the liquidity of receivables computed by dividing the current balance of receivables by the annual credit (or net) sales, and then multiplying by 365; also called days' sales in receivables. (p. 269) |
| Deposits in Transit | Deposits recorded by the company but not yet by its bank. (p. 266) |
| Deposit Ticket | Lists items such as currency, coins, and checks deposited and their corresponding dollar amounts. (p. 263) |
| Discounts Lost | Expense resulting from a failure to take advantage of cash discounts on purchases. (p. 262) |
| Electronic Funds Transfer (EFT) | Use of electronic communication to transfer cash from one party to another. (p. 263) |
| Gross Method | Method of recording purchases at the full invoice price without deducting any cash discounts. (p. 261) |
| Internal Control System | All policies and procedures used to protect assets, ensure reliable accounting, promote efficient operations, and urge adherence to company policies. (p. 250) |
| Invoice | Itemized record of goods prepared by the vendor that lists the customer's name, the items sold, the sales prices, and the terms of sale. (p. 273) |
| Liquid Assets | Resources such as cash that are easily converted into other assets or used to pay for goods, services, or liabilities. (p. 255) |
| Liquidity | Company's ability to pay for its short-term obligations. (p. 255) |
| Net Method | Method of recording purchases at the full invoice price less any cash discounts. (p. 262) |
| Outstanding Checks | Checks written and recorded by the depositor but notyet paid by the bank at the bank statement date. (p. 266) |
| Principles of Internal Control | Principles requiring management to establish responsibility, maintain records, insure assets, separate recordkeeping from custody of assets, divide responsibility for related transactions, apply technological controls, and perform reviews. (p. 250) |
| Purchase Order | Document used by the purchasing department to place an order with a seller (vendor) |
| Purchase Requisition | Document listing merchandise needed by a department and requesting it be purchased. (p. 272) |
| Receiving Report | Form used to report that ordered goods are received and to describe their quantity and condition. (p. 273) |
| Vendee | Buyer or purchaser of goods or services. (p. 273) |
| Vendor | Seller of goods or services. (p. 272) |
| Voucher | Internal file used to store documents and information to control cash disbursements and to ensure that a transaction is properly recorded. (p. 258) |
| Voucher System | Procedures and approvals designed to control cash disbursements and acceptance of obligations. (p. 257) |
