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Financial Terms | |
Accounts |
Information about financial, finance, business, accounting, payroll, inventory, investment, money, inventory control, stock trading, financial advisor, tax advisor, credit.
Main Page: inventory, inventory control, financial, accounting, stock trading, payroll, business, money, Also see related: home insurance, home, first time homebuyer, property, home financing, credit, condo, real estate, buy home, |
Definition of AccountsAccounts‘Buckets’ within the ledger, part of the accounting system. Each account contains similar transactions (line items) that are used for the production of financial statements. Or commonly used as an abbreviation for financial statements.
Related Terms:Accounts payableMoney owed to suppliers. ACCOUNTS PAYABLEAmounts a company owes to creditors. Accounts payableAmounts owed by the company for goods and services that have been received, but have not yet been paid for. Usually accounts payable involves the receipt of an invoice from the company providing the services or goods. accounts payableShort-term, non-interest-bearing liabilities of a business Accounts payableAcurrent liability on the balance sheet, representing short-term obligations Accounts PayableAmounts due to vendors for purchases on open account, that is, not evidenced Accounts Payable Days (A/P Days)The number of days it would take to pay the ending balance ![]() Accounts receivableMoney owed by customers. ACCOUNTS RECEIVABLEAmounts owed to a company by customers that it sold to on credit. Total accounts receivable are usually reduced by an allowance for doubtful accounts. Accounts receivableAmounts owed to the company, generally for sales that it has made. accounts receivableShort-term, non-interest-bearing debts owed to a Accounts receivableA current asset on the balance sheet, representing short-term Accounts ReceivableAmounts due from customers for sales on open account, not evidenced Accounts ReceivableMoney owed to a business for merchandise or services sold on open account. Accounts Receivable Days (A/R Days)The number of days it would take to collect the ending Accounts receivable turnoverThe ratio of net credit sales to average accounts receivable, a measure of how ![]() accounts receivable turnover ratioA ratio computed by dividing annual Allowance for doubtful accountsA contra account related to accounts receivable that represents the amounts that the company expects will not be collected. Allowance for Doubtful AccountsAn estimate of the uncollectible portion of accounts receivable Average age of accounts receivableThe weighted-average age of all of the firm's outstanding invoices. Balance of Payments AccountsA statement of a country's transactions with other countries. Chart of accountsA listing of all accounts used in the general ledger, usually sorted in Discounting of Accounts ReceivableShort-term financing in which accounts receivable are used as collateral to secure a loan. The lender does not buy the accounts receivable but simply uses them as collateral for the loan. Also called pledging of accounts receivable. IRA/Keogh accountsSpecial accounts where you can save and invest, and the taxes are deferred until money National Income and Product AccountsThe national accounting system that records economic activity such as GDP and related measures. Permanent accountsThe accounts found on the Balance Sheet; these account balances are carried forward for the lifetime of the company. Provision for Doubtful AccountsAn operating expense recorded when the allowance for Temporary accountsThe accounts found on the Income Statement and the Statement of Retained Earnings; these accounts are reduced to zero at the end of every accounting period. Unbilled Accounts ReceivableRevenue recognized under the percentage-of-completion accounting equationAn equation that reflects the two-sided nature of a Accounting exposureThe change in the value of a firm's foreign currency denominated accounts due to a Accounting systemA set of accounts that summarize the transactions of a business that have been recorded on source documents. accrued expenses payableThe account that records the short-term, noninterest- ACID-TEST RATIOA ratio that shows how well a company could pay its current debts using only its most liquid or “quick” assets. It’s a more pessimistic—but also realistic—measure of safety than the current ratio, because it ignores sluggish, hard-toliquidate current assets like inventory and notes receivable. Here’s the formula: acid test ratio (also called the quick ratio)The sum of cash, accounts receivable, and short-term marketable Aging scheduleA table of accounts receivable broken down into age categories (such as 0-30 days, 30-60 aging scheduleClassification of accounts receivable by time outstanding. AllocationThe process of storing costs in one account and shifting them to other Allowance for bad debtsAn offset to the accounts receivable balance, against which Allowance methodA method of adjusting accounts receivable to the amount that is expected to be collected based on company experience. AssurisAssuris is a not for profit organization that protects Canadian policyholders in the event that their life insurance company should become insolvent. Their role is to protect policyholders by minimizing loss of benefits and ensuring a quick transfer of their policies to a solvent company where their benefits will continue to be honoured. Assuris is funded by the life insurance industry and endorsed by government. If you are a Canadian citizen or resident, and you purchased a product from a member life insurance company in Canada, you are protected by Assuris. Average Collection PeriodAverage number of days necessary to receive cash for the sale of Average collection period, or days' receivablesThe ratio of accounts receivables to sales, or the total Bad debtsThe amount of accounts receivable that is not expected to be collected. bad debtsRefers to accounts receivable from credit sales to customers BALANCE SHEETA “snapshot” statement that freezes a company on a particular day, like the last day of the year, and shows the balances in its asset, liability, and stockholders’ equity accounts. It’s governed by the formula: Balance SheetOne of the basic financial statements; it lists the assets, liabilities, and equity accounts of the company. The Balance Sheet is prepared using the balances at the end of a specific day. book value and book value per shareGenerally speaking, these terms Breeder bill of materialsA bill of material that accounts for the generation and Buy-side analystA financial analyst employed by a non-brokerage firm, typically one of the larger money Capital AccountThat part of the balance of payments accounts that records demands for and supplies of a currency arising from purchases or sales of assets. CapitalizedRecorded in asset accounts and then depreciated or amortized, as is appropriate for expenditures CashThe value of assets that can be converted into cash immediately, as reported by a company. Usually Cash and equivalentsThe value of assets that can be converted into cash immediately, as reported by a Cash conversion cycleThe length of time between a firm's purchase of inventory and the receipt of cash Cash cycleIn general, the time between cash disbursement and cash collection. In net working capital Cash CycleThe length of time between a purchase of materials and collection of accounts receivable generated by the sale of the products made from the materials. cash flow from operating activities, or cash flow from profitThis equals the cash inflow from sales during the period minus the cash Change in Accounting EstimateA change in the implementation of an existing accounting Closing entriesThe entries that transfer the balances in the revenue, expense, and dividend accounts to Retained earnings and zero out the revenue, expense, and dividend accounts for the next period. Collection DepartmentAn internal department within a company staffed by specialists in collecting past due accounts or accounts receivable. Collection policyProcedures followed by a firm in attempting to collect accounts receivables. Commission houseA firm which buys and sells future contracts for customer accounts. Related: futures controllerthe chief accountant (in a corporation) who is responsible Cookie Jar ReservesAn overly aggressive accrual of operating expenses and the creation of Cost Plus Estimated Earnings in Excess of BillingsRevenue recognized to date under the percentage-of-completion method in excess of amounts billed. Also known as unbilled accounts Current AccountThat part of the balance of payments accounts that records demands for and supplies of a currency arising from activities that affect current income, namely imports, exports, investment income payments such as interest and dividends, and transfers such as gifts, pensions, and foreign aid. Current assetTypically the cash, accounts receivable, and inventory accounts on the Current assetsValue of cash, accounts receivable, inventories, marketable securities and other assets that Current assetsCash, things that will be converted into cash within a year (such as accounts receivable), and inventory. current assetsCurrent refers to cash and those assets that will be turned Current liabilitiesAmount owed for salaries, interest, accounts payable and other debts due within 1 year. current liabilitiesCurrent means that these liabilities require payment in Current liabilityThis is typically the accounts payable, short-term notes payable, and Days StatisticsMeasures the number days' worth of sales in accounts receivable (accounts receivable Dealer marketA market where traders specializing in particular commodities buy and sell assets for their Demand depositsChecking accounts that pay no interest and can be withdrawn upon demand. Direct write-off methodA method of adjusting accounts receivable to the amount that is expected to be collected by eliminating the account balances of specific nonpaying customers. Discretionary accountaccounts over which an individual or organization, other than the person in whose Double entryThe system of recording business transactions in two accounts. Electronic depository transfersThe transfer of funds between bank accounts through the Automated FactorA financial institution that buys a firm's accounts receivables and collects the debt. FactoringSale of a firm's accounts receivable to a financial institution known as a factor. FactoringThe sale of accounts receivable to a third party, with the third party bearing FactoringThe discounting, or sale at a discount, of receivables on a nonrecourse, notification FactoringType of financial service whereby a firm sells or transfers title to its accounts receivable to a factoring company, which then acts as principal, not as agent. FASB No. 52The U.S. accounting standard which was replaced by FASB No. 8. U.S. companies are required FASB No. 8U.S. accounting standard that requires U.S. firms to translate their foreign affiliates' accounts by Financial PositionStatus of a firm's assets, liabilities, and equity accounts as of a certain time, as shown in its financial statement. Fixed AssetsLand, buildings, plant, equipment, and other assets acquired for carrying on the business of a company with a life exceeding one year. Normally expressed in financial accounts at cost, less accumulated depreciation. Foreign currency translationThe process of restating foreign currency accounts of subsidiaries into the General ledgerA book that contains all the accounts of the company and the balances of those accounts. General ledgerThe master set of accounts that summarizes all transactions occurring Homemade leverageIdea that as long as individuals borrow (or lend) on the same terms as the firm, they can Income StatementOne of the basic financial statements; it lists the revenue and expense accounts of the company. Indirect-Method FormatA format for the operating section of the cash-flow statement that Interest incomeIncome that a company receives in the form of interest, usually as the result of keeping money in interest-bearing accounts at financial institutions and the lending of money to other companies. Interest OptionOne of several investment accounts in which your premiums may be invested within your life insurance policy. Investment bankFinancial intermediaries who perform a variety of services, including aiding in the sale of Related to : financial, finance, business, accounting, payroll, inventory, investment, money, inventory control, stock trading, financial advisor, tax advisor, credit. |