| A | B |
|---|
| retained earnings | amount earned by corporation and not yet distributed |
| dividend | earnings distributed to stockholder |
| board of directors | group elected by stockholders to manage corporation |
| declaring a dividend | action by board of directors to distribute corporate earnings to stockholders |
| merchandise inventory | amount of goods on hand for sale to customers |
| uncollectible accounts | accounts receivable that cannot be collected |
| allowance method | crediting estimated value of uncollectible accounts to contra account |
| book value | difference between asset's account balance and its related contra account balance |
| book value of accounts receivable | Accounts Receivable - Allowance for Uncollectible Accounts |
| current assets | cash and other assets expected to be exchanged for cash or consumed within year |
| plant assets | assets that will be used for number of years |
| depreciation expense | portion of plant asset's cost that is transferred to expense account |
| estimated salvage value | amount owner expects to receive at disposal |
| straight-line method of depreciation | charging equal amount of depreciation expense for plant asset each year |
| accumulated depreciation | total amount of depreciation expense that has bee recorded since purchase of plant asset |
| book value of plant asset | original cost - accumulated depreciation |
