Financial Accounting: An Integrated Statements Approach, 2nd Edition

I-3 Index

Declining-balance method, 407

Deferrals, 105, 107

Deferred expenses, 101, 459

Deferred liabilities, 459

Deferred revenues, 106, 459

Depreciable cost, 405

Depreciation, 108, 404, 586

accounting for, 404

estimates, revising, 409

expense, factors in computing, 405

fixed assets, and cash flow, 419

for federal income tax, 409

methods, 406, 408

Direct labor costs, 267

Direct materials, 267

Direct method, 234, 580

and allowance methods, comparing,

365

reporting cash flows from operating

activities, 595

statement of cash flows, 591

Direct write-off method, 357

and allowance method, comparing,

364

for uncollectible accounts, 358

Disclosures, long-term liability, 462

Discontinued operations, 541

Discount, 443

amortization of by the interest

method, 468

bonds issued at, 454

purchases, 215, 225

rate, 443

sales, 215, 223

Discounting, 449

Dishonored note receivable, 367

Disposals, fixed asset, 410

Dividend payout ratio, 511, 651

for selected industries, 512

Dividend safety, 511

Dividend yield, 510, 651

Dividends, 12, 496

accounting for, 505

analyze, 510

capital stock and, 512

cash, 505

cash flows used for payment of, 588

stock, 507

to cumulative preferred stock,

498–499

Double-declining-balance method, 407

Double-entry accounting system, 157

Doubtful accounts expense, 357

Due date, 365

Dun & Bradstreet Reference Book of

American Business, 369

DuPont formula, 640

Duties, rotating, 311

E

Earning per share dilution, 504

Earnings before interest, taxes, depreci-

ation, and amortization (EBITDA),

173

Earnings per common share (EPS), 542

Earnings per share (EPS), 650

Effective interest rate method, 455

of amortization, 467

Efficient consumer response, 281

Electronic funds transfers (EFT), 317,

318

Elements of internal control, 309

Employee fraud, 309

tips on preventing, 312

Employee theft, 230

Employees’ fringe benefits, 446

Employees, phantom, 445

Employer payroll taxes, liability for, 445

Equity

owners’, 17

stockholders’, 17, 115, 508

Equity method, 546

Equity securities, 544

Estimation methods, comparing, 363

Exercise period, 501

Exercise price, 501

Expected useful life, 405

Expenditures, capital and revenue, 403

Expenses, 12, 112

administrative, 12, 217

deferred, 459

general, 217

other, 217

prepaid, 12

selling, 12, 217

Extraordinary item, 541

Extraordinary repairs, 403

F

Face value, bonds issued at, 451

Factor, 357

Factoring, 357

Factors in computing depreciation ex-

pense, 405

Factory overhead costs, 267

Fair value, 507

Federal income tax, depreciation for, 409

Federal Insurance Contributions Act

(FICA).SeeFICA

Federal Unemployment Tax Act (FUTA).

SeeFUTA

FICA, 444

tax, 444, 445

Financial accounting, 13

objectives of, 14

system, 54

Financial Accounting Standards Board

(FASB), 21, 314, 541

Financial measures, market-based, 552

Financial reporting system, 154, 163

Financial statement approach, inte-

grated, 54

Financial statements, 14, 63–64,

67–68, 110, 165, 166–167

common-sized, 120

consolidated, 549

effect of inventory costing methods

on, 270

effects of inventory misstatements on,

231

effects of journal entries on, 158

for a corporation’s first period of

operations, 62

for a corporation’s second period of

operations, 66

for a merchandising business, 213

integrated, 19

integration of, 65, 115, 218

report on fairness of, 654

reporting of cash, 326

Financial utilization analysis, 418

Financing activities, 10

cash flow from, 580, 582

cash flows used for, 236

net cash flow provided by, 582

net cash flow used for, 582

noncash, 582

Financing alternatives, analyzing, 504

Finished goods inventory, 266

First-in, first-out (fifo) method, 269, 271,

274, 277

Fiscal year, 168

Fixed asset analysis, 644

Fixed asset disposals, 410

Fixed asset impairment, 538

Fixed asset turnover, 645

Fixed asset turnover ratio, 418

Fixed assets, 114, 400

analyzing, 416

as barriers to competition, 401

cost of, 401, 402

depreciation, and cash flow, 419

discarding of, 411

nature of, 400

reporting of, 415

to long-term liabilities, ratio of, 648

selling of, 411

FOB (free on board) destination, 226

FOB (free on board) shipping point,

226

Framework, 54

Fraud, 158, 224

accounting, 24

check, 322

employee, 309

receivables, 364

stock, 498

tips on preventing employee, 312

Free cash flow, 597

Fringe benefits, 446

FUTA, 445

tax, 445

G

Gain on sale of land, 587, 594

General expenses, 217

General journal, 157

General ledger, 160, 222

Generally accepted accounting principles

(GAAP), 20, 357

Going concern concept, 22

Goods sold, cost of, 12, 266