ACCT CH 7

financial accounting

• The area of accounting that focuses on reporting information to external users.
• A comparison between two components of financial information.
• The ratio of net income to total sales.

managerial accounting

• The area of accounting which focuses on reporting information to internal users.
• A financial road map used by individuals and companies as a guide for spending and saving.
• The calculation and interpretation of a financial ratio.

statement of owner's equity

• A financial statement that reports the changes in the capital account for a proprietorship for a period of time
• A negative balance that remains after total expenses are subtracted from total income.
• The area of accounting which focuses on reporting information to internal users.

financial ratio

• A comparison between two components of financial information.
• A financial statement that reports the changes in the capital account for a proprietorship for a period of time
• The area of accounting that focuses on reporting information to external users.

ratio analysis

• The calculation and interpretation of a financial ratio.
• Any persons or groups who will be affected by an action.
• Reporting an amount on a financial statement as a percentage of another item on the same financial statement.

vertical analysis

• Reporting an amount on a financial statement as a percentage of another item on the same financial statement.
• Financial statements providing information for a time period shorter than the fiscal year.
• Any persons or groups who will be affected by an action.

return on sales (ROS)

• The ratio of net income to total sales.
• Reporting an amount on a financial statement as a percentage of another item on the same financial statement.
• Financial statements providing information for a time period shorter than the fiscal year.

stakeholders

• Any persons or groups who will be affected by an action.
• The area of accounting that focuses on reporting information to external users.
• A negative balance that remains after total expenses are subtracted from total income.

budget

• A financial road map used by individuals and companies as a guide for spending and saving.
• The area of accounting which focuses on reporting information to internal users.
• A financial statement that reports the changes in the capital account for a proprietorship for a period of time

deficit

• A negative balance that remains after total expenses are subtracted from total income.
• The calculation and interpretation of a financial ratio.
• A financial road map used by individuals and companies as a guide for spending and saving.