If Assets Increase, Then, Applying the Principle of Duality, We

question 57

True/False

If assets increase, then, applying the principle of duality, we must increase liabilities, decrease another asset or increase owners' equity.

Differentiate between period costs and product costs in manufacturing and service organizations.

Recognize how costs are reported on the financial statements of manufacturing businesses.

Understand the sources and documentation used in job order cost accounting, including material requisitions and receiving reports.

Recognize the applicability of job order cost accounting systems across different types of organizations, not limited to manufacturing.

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Definitions:

Sales Returns and Allowances

A reduction in sales revenue due to returns or allowances for unsatisfactory goods, reported as a contra-revenue account.

Debit Memorandum

A document issued to signal a decrease in accounts receivable, often due to a return or an adjustment.

Accounts Payable

Liabilities or amounts a company owes to creditors or suppliers for goods or services that have been received but not yet paid for.

Sales Discount

A reduction from the listed or invoice price offered by a seller to a buyer, often to prompt early payment or reward bulk purchases.