FBLA Accounting 1

Return on investment

The ration of the money earned on investment relative to the amount of the investment.

Real property

Land and anything attached to the land.

Personal property

All property not classified as real property.

Assessed value

The value of an asset determined by tax authorities for the purpose of calculating taxes.

Plant asset record

An accounting form on which a business records information about each plant asset.

Gain

An increase in equity resulting from activity other than selling goods or services.

Gain on plant assets

An increase in equity that results when a plant asset is sold for more than book value.

Loss

A decrease in equity resulting from activity other than selling goods or services.

Loss on plant assets

The decrease in equity that results when a plant asset is sold for less than book value.

Accelerated depreciation

Any method of depreciation which records greater depreciation expense in the early years and less depreciation expense in the later years.

Declining-balance method of depreciation

A type of accelerated depreciation that multiplies the book value of an asset by a constant depreciation rate to determine annual depreciation.

Double-declining balance method of depreciation

A declining-balance rate that is two times the straight-line rate.

Intangible asset

An asset that does not have physical substance.

Amortization

The spreading of the cost of an intangible asset over its useful life.

payroll

list of a business's employees and the payment due to each employee for a specific pay period

pay period

amount of time for which an employee is paid

payroll clerk

a person who is responsible for preparing the payroll

gross earnings

total amount of money earned by an employee in a pay period

salary

fixed amount of money paid to an employee for each pay period

wage

amount of money paid to an employee at a specificed rate per hour worked

time card

record of the time an employee arrives at work each time, the time the employee leaves, and the total number of hours worked each day

electronic badge readers

computer technology where each employee's time card has a magnetic strip on which is encoded certain employee information

piece rate

amount paid for each piece produced in a factory or manufacturing plant

commission

amount paid to an employee based on a percentage of the employee's salary

overtime rate

set by the Fair Labor Standards Act, is 1 and 1/2 times the employee's regular rate

deduction

the amount that is subtracted from gross earnings

exemption

an allowance claimed by a taxperson that reduces the amount of taxes that must be paid

payroll register

form that summarizes information about an employees' earnings for each pay period

net pay

amount of money left after all deductions are subtracted from gross earnings

direct deposit

the employee's net pay is deposited in her or his personal bank account

employee's earnings record

where the individual payroll record for each employee is recorded

accumulated earnings

each employee's year to date gross earnings

unemployment taxes

based on a percentage of their employees' gross earnings and are collected to provide funds for workers who are temporarily out of work

federal tax deposit coupon

(Form 8109) prepared and sent with the check to show the amount of taxes being sent to the federal governement

form 941

the employer's quarterly federal tax return

form w-2

summarizes an employee's earnings and tax deductions for the previous calendar year

form w-3

summarizes the information contained on the employee's form w-2

form 940

an employer's annual unemployment tax return

internal controls

those steps the business takes to protect cash and other assets

external controls

those controls provided outside the business (ex. verifying the accuracy of a signature)

Transaction

A business activity that changes assets, liabilities, or owner's equity.

Account

A record summarizing all the information pertaining to a single item in the accounting equation

Account Title

The name given to an account.

Account Balance

The amount in an account

Capital

the account used to summarize the owner's equity in a business

Revenue

an increase in owner's equity resulting from the operation of a business

Sale on Account

A sale for which cash will be recieved at a later date

Expense

a decrease in owner's equity resulting from the operation of a business

Withdrawls

Assets taken out of a business for the owner's personal use.