Glossary of Terms
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- Imprest system:
- A system for controlling small cash disbursements by establishing a fund at a fixed amount and periodically reimbursing the fund by the amount necessary to bring the fund back to the fixed amount.
- Income from operations:
- Gross margin from sales less operating expenses.
- Income statement:
- The financial statement that summarizes the amount or revenues earned and expenses incurred by a business over a period of time.
- Income Summary:
- A temporary account used during the closing process that holds summary of all revenues and expenses before the net income or loss is transferred to the Capital account.
- Independence:
- The avoidance of all relationships that impair or appear to impair an accountant’s objectivity.
- Indirect costs:
- Production costs that are traced easily to specific products and that must be assigned by some cost assignment method.
- Indirect labor costs:
- Labor cost for production-related activities that cannot be conveniently or economically traced to a product unit.
- Indirect materials:
- Minor materials and other production supplies that cannot be conveniently or economically to specific product units.
- Installment accounts receivable:
- Accounts receivable that are payable in a series of time payments.
- Intangible assets:
- Long-term assets that have no physical substance but have a value based on rights or privileges that accrue to the owner.
- Integrity:
- Honesty, candidness, and the subordination of personal gain to service and the public trust.
- Interest:
- The cost of borrowing money or the return for landing money, depending on whether one is the borrower or the lender.
- Internal control:
- All the policies and procedures a company uses to safeguard its assets, check the accuracy and reliability of its accounting data, promote operational efficiency and encourage adherence to its policies.
- Internal control structure:
- A structure established to safeguard the assets of a business and provide reliable accounting records; consists of the control environment, the accounting system, and control procedures.
- Internal Revenue Service (IRS):
- The federal agency that interprets and enforces the tax laws governing the assessment and collection of revenue for operating the national government.
- Inventory cost:
- The price paid or consideration given to acquire an asset; includes invoice price less purchases discounts, plus freight or transportation in, and applicable taxes or tariffs.
- Investments:
- Assets, generally of a long-term nature, that are not used in the normal operation of a business and that management does not intend to convert to cash within the next year.
- Invoice:
- A form sent or delivered to the purchaser by the vendor that describes the quantity and price of the goods or services delivered and the terms of payment.