Term
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Definition
| Providing a good or a service and collection is probable. |
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Term
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Definition
| Represents a reduction in price for products/services. |
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Term
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Definition
| Reduces the amount the customer owes the company if paid within a specific time period; Encourages early payment by the customer. |
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Term
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Definition
| Only applies to credit sales and encourages your credit customers to pay early. 2% discount if pay within 10 days. |
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Term
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Definition
Revenue - Contra Revenues
Gross Profit + COGS |
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Term
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Definition
| Estimate the amount of accounts receivable that will not be collected. |
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Term
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Definition
| Amount of accounts receivable we expect to collect. |
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Term
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Definition
| Customer accounts that the company no longer expects to collect. |
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Term
| Allowance for Collectable Accounts (AUA) |
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Definition
| Done at end of the accounting period. Determined based of ending A/R x % of uncollectible accounts. |
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Term
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Definition
| Opposite of revenue and includes sales discount, allowances, and return. |
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Term
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Definition
| Shown on income statement. Credit you subtract debits you add. |
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Term
| Writing Off an Account Receivable |
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Definition
| Only effects accounts receivable and allowance for uncollectible accounts. Nothing else changes. |
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Term
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Definition
| Amount invested x % of interest / time over 12. |
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Term
| Goods Available For Sale (GAFS) |
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Definition
| Beginning Inventory + Purchases. |
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Term
| Costs of Goods Sold (COGS) |
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Definition
GAFS- Ending Inventory (EI)
Net Sales- Gross Profit |
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Term
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Definition
| Multiply units left over by last unit cost. |
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Term
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Definition
| Multiply units left over by first cost. |
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Term
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Definition
| GAFS/Total units collected |
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Term
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Definition
| Net Sales - Cost of Goods Sold (COGS) |
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Term
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Definition
All expenses added together.
Gross profit - Operating Income |
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Term
| Income Before Taxes (IBT) |
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Definition
| Gross profit - Operating expenses + Interest Revenue |
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Term
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Definition
| Income Before Taxes x Income Tax Rate |
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Term
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Definition
| Income Before Taxes - Income Tax Expense |
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Term
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Definition
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Term
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Definition
| Gross Profit - Operating Expense |
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Term
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Definition
| Buy inventory for resale. |
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Term
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Definition
| Cost to acquire including shipping and handling. |
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Term
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Definition
| Create inventory from raw materials to sell to others. |
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Term
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Definition
| Raw material, work in process, and finished good. |
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Term
| Cost of Good Sold Definitions (COGS) |
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Definition
| Is an expense and is the cost of the seller of inventory sold to the consumer. |
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Term
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Definition
| Profit from the sale of inventory. |
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Term
| Operating Income Definition |
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Definition
| Profit from normal operations. |
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