| A | B |
|---|
| sales discount | A cash discount on sales |
| owner's equity | The amount remaining after the vlaue of all liabilities is subtracted from the value of all assets. |
| purchases discount | A cash discount on purchases taken by a customer. |
| controlling account | An account in a general ledger that summarizes all accounts in a subsidiary ledger. |
| petty cash | An amount of chas kept on hand and used for making small payments. |
| merchandising business | A business that purchases and sells goods. |
| debit memorandum | A form prepared by the customer showing the price deduction taken by the customer for returns and allowances. |
| asset | Anything of value that is owned. |
| liability | An amount owed by a business. |
| ledger | A group of accounts. |
| double-entry accounting | The recording of debit and credit parts of a transaction. |
| journal | A form for recording transactions in chronological order. |
| contra account | An account that reduces a related account on a financial statement. |
| special journal | A journal used to record only one kind of transaction. |
| source document | A business paper from which information is obtained for a journal entry. |
| equities | Financial rights to the assets of a business. |
| posting | Transferring information from a journal entry to ledger account. |
| cash discount | A deduction that a vendor allows on an invoice amount to encourage prompt payment. |
| departmental accounting system | An accounting system showing accounting information for two or more departments. |
| accounting equation | An equation showing the relationship among assets, liabilities, and owner's equity. |
| general ledger | A ledger that contains all accounts needed to prepare financial statements. |
| account | A record summarizing all the information pertaining to a single item in the accounting equation. |
| file maintenance | The procedure for arranging accounts in a general ledger, assigning account numbers, and keeping records current. |
| subsidiary ledger | A ledger that is summarized in a single general ledger account. |
| empty | empty |
| Unit of Measurement | Business transactions are stated in numbers that have common values; that is, using a common unit of measurement |
| Matching Expenses With Revenue | Revenue from business activities and expenses associated with earning that revenue are recorded in the same fiscal period |
| Objective Evidence | A source document is needed for every transaction |
