Accounting Terminology Listed Below Are Nine Technical Accounting Terms Introduced in This

question 151

Essay

Accounting terminology
Listed below are nine technical accounting terms introduced in this chapter:

Each of the following statements may (or may not) describe one of these technical terms. In the space provided beside each statement, indicate the accounting term described, or answer "None" if the statement does not correctly describe any of the terms.
____ (a) A financial statement showing the revenue, expenses, and net earnings of a corporation during the current accounting period.
____ (b) A distribution of cash to stockholders.
____ (c) A distribution to stockholders of additional shares of stock, accompanied by a proportionate reduction in the par value per share.
____ (d) The market price of a share of preferred stock, divided by the net income of the corporation.
____ (e) A correction in the amount of net income reported in an earlier accounting period.
____ (f) An event that is material in dollar amount, unusual in nature, and not expected to recur in the foreseeable future.
____ (g) A subtotal sometimes included in an income statement to assist investors in forecasting the income of future accounting periods.

Understand the concept of normal and inferior goods, including how changes in income affect the demand for these goods.

Understand the concept of price elasticity of demand and how to calculate it using the midpoint method.

Recognize the relationship between price changes and total revenue, especially in terms of elasticity.

Understand the income elasticity of demand and how it differs from price elasticity.

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