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Accounting Chapter 9
| Term | Definition |
|---|---|
| Merchandise | Goods that a business purchases to sell |
| Merchandising Business | A business that purchases and resells goods |
| Retail Merchandising Business | A merchandising business that sells to those who use or consume the goods |
| Wholesale Merchandising Business | Buys and resells merchandise primarily to other merchandising businesses |
| Corporation | An organization with the legal rights of a person which many persons or other corporations may own |
| Capital | The assets or other financial resources available to a business |
| Share of Stock | Each unit of ownership in a corporation |
| Stockholder | The owner of one or more shares of stock |
| Capital Stock | The total shares of ownership in a corporation |
| Articles of Incorporation | A legal document that identifies basic characteristics of a corporation, is a part of the application submitted to a state to become a corporation |
| Charter | The legal right for a business to conduct operations as a corporation |
| Vendor | A business from which merchandise, supplies, or other assets are purchased |
| Subsidiary Ledger | A ledger that is summarized in a single general ledger account |
| Subledger | Accountants often refer to a subsidiary ledger as a |
| Accounts Payable Ledger | The subsidiary ledger containing vendor accounts |
| Controlling Account | An account in a general ledger that summarizes all accounts in a subsidiary ledger |
| Inventory | A list of assets, usually containing the value of individual items |
| Merchandise Inventory | The goods a business has on hand for sale to customers |
| Perpetual Inventory | An inventory determined by keeping a continuous record of increases, decreases, and the balance on hand of each item of merchandise |
| Periodic Inventory | A merchandise inventory evaluated at the end of a fiscal period |
| Physical Inventory | When a periodic inventory is conducted by counting, weighing, or measuring items of merchandise on hand |
| Cost of Merchandise | The amount a business pays for goods it purchases to sell |
| Requisition | A form requesting the purchase of merchandise |
| Purchase Order | A form requesting that a vendor sell merchandise to a business |
| Special Journal | A journal used to record only one kind of transaction |
| Purchase on Account | A transaction in which the items purchased are to be paid for later |
| Purchase Journal | A special journal used to record only purchases of merchandise on account |
| Special Amount Column | A journal amount column headed with an account title |
| Purchase Invoice | An invoice used as a source document for recording a purchase on account transaction |
| Terms of Sale | An agreement between a bury and a seller about payment for merchandise |
| Due Date | The date by which an invoice must be paid |
| Cash Payments Journal | A special journal used to record only cash payments transactions |
| List Price | The retail price listed in a catalog or on an Internet site |
| Trade Discount | A reduction in the list price granted to a merchandising business |
| Net Price | The price after the trade discount has been deducted from the list price is referred to as |
| Cash Discount | A deduction that a vendor allows on an invoice amount to encourage prompt payment |
| General Amount Column | A journal amount column that is not headed with an account title |
| Discount Period | The period of time during which a customer may take a cash discount |
| Purchases Discount | When a company that has purchases merchandise on account takes a cash discount |
| Contra Account | An account that reduces a related account on a financial statement |
| Credit Limit | The maximum outstanding balance allowed to a customer by a vendor. |
| Schedule of Accounts Payable | A listing of vendor accounts, account balances, and the total amount due to all vendors |
Created by:
jykirra
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