MATCHING CONCEPTS WITH

DEFINITIONS
1.- Accounting procedure
2.- Accounting profits
3.- Accounting information system
4.- Accounts receivable.
5.- Annual accounts
6.- Annual income.
7.- Auditing.
8.- Balance of payments
9.- Bank balance.
10.- Bankrupt
11.- Book sales book sales
12.- Accelerated depreciation.
13.- Accounting rate-of-return method.
14.- Amortized cost.
15.- Amortized loan.
16.- Annual report.

_______1_____an accounting method developed by an individual or organisation to deal with

routine accounting tasks
_____2_______the difference between revenue and the costs of production.
______3______a system, usually computer-based, that processes information on a company’s
transactions for accounting purposes.
______4______money owed to a company. Abbreviation .
________5____the accounts prepared at the end of a financial year
_________6___money received during a calendar year
______7_____the work of examining the books and accounts of a Company.
_____8______a comparison between total receipts and payments arising from a country’s
international trade in goods, services and financial transactions
______9____the state of a bank account at any particular time.
____10______who has been declared by a court not to be capable of paying his or her debts and
whose affairs are put into the hands of a receiver.
______11_____sales as recorded in the sales book
_____12______Methods of allocating the cost of an asset against income. Accelerated-depreciation
methods charge off more of the cost in the early years of the asset’s use. Accelerated depreciation is
mainly used for tax accounting because it can result in the company paying lower taxes in the early
years of asset use
__13________ A measure used in capital budgeting decisions. The accounting rate of return is
calculated by dividing the projected net income by the forecast asset book value for each year of the
asset’s use. The average of the calculated rates is equal to the accounting rate of return. This method
uses accrual numbers rather than cash flows and does not adjust for the time value of money.
____14______ The balance sheet value for debt investments purchased at a premium or discount.
_____15_____ A loan that is repaid with equal payments over the life of the loan. Each payment
contains a different proportion of principal and interest. Early payments have a higher percentage of
interest included in the payment than later payments. Most consumer car loans are amortized loans.
Contrast with a bond in which only interest is paid over the term of the borrowing and the entire
principal is paid at maturity.
______16____ A document produced by a business once per year that contains financial
information and other information about the company. The annual report must include the financial
statements and notes to them, the audit report, management’s analysis, and other items that help
convey information useful to people outside the company.