Perpetual Inventory System - All purchases during the period are debited to the Inventory Account. Balance of the Inventory can be determined without physical accounts.

Periodic Inventory System - Purchases of Inventory are debited to Purchase Account. Ending Inventory can be determined by actual physical count of Inventories on hand.

Accrued Expenses - Expenses already incurred but not yet paid as of the end of the accounting period.

Accrued Income - Revenue already earned but not yet collected and recorded as of the end of the accounting period.

Voucher system - A system which uses two special journals namely, the voucher register and check register.

Voucher System - Formalized system of the internal control over disbursements.

Voucher - A special form used in recording data pertaining liability and purpose of its payment. Document that serves as evidence of authority to pay cash.

Voucher register - A special journal where the vouchers are recorded.

Check - A written instrument signed by a depositor ordering the bank to pay a specified sum of money to the order or designated person or entity.

Check register - A special journal where checks are recorded chronologically. Modified form of the cash payments journal.

Drawer - The one who signs the check.

Drawee - The bank on which the check is drawn .

Payee - The one whose order the check is drawn.

Internal Control - The detailed procedure adopted by an enterprise to control its operations, the check, and the balance to safeguard companies' properties.

Files of the Unpaid Vouchers - Serves as the substitute for the subsidiary ledger for Accounts Payable account.

Manufacturing Business - Engaged in transforming raw materials into new products called finished goods.

Direct Materials - All materials that form an integral part of the finished goods. Prime Cost

Direct Labor - Labor cost that incurred in converting direct materials into finished product and can be assigned specifically to a product. Prime Cost and Conversion Cost

Factory Overhead - Cost incurred in the conversion process which are not classified as direct material nor direct labor. Manufacturing overhead/ Factory burden. Conversion Cost

Indirect Materials - Materials used in production which may form an integral part of the product but the cost and quantity is insignificant

Indirect Labor - Salary of persons necessary in the production but not directly the one who performed the job in the making the product.

Electricity - Electric consumption in the factory plant.

Allocated costs - Cost that are not traceable as to which product will be charged.

Income Statement - A formal report which shows the results of the business operations.

Statement of Changes in Equity - A formal report which shows the changes in the capital or equity of the owner.

Statement of Financial Position - A formal report which shows the financial condition of the business.