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Purchasing power gains or losses

What are purchasing power gains or losses? Those gains or losses that result from holding monetary assets (cash and rights to receive cash) and monetary liabilities (all liabilities other than those requiring the performance of service) during periods of inflation or deflation.

Purchase Method Definition

What is the Purchase Method? A method of preparing consolidated financial statements in which the net assets of the purchased company are revalued to their fair market value is called purchase method.

Publicly Held Corporation

What is meant by Publicly Held Corporation? A corporation, the stock of which is owned by outside investors, and which stock and/or bonds are listed on a national and regional exchange.

Pooling or interest method definition

What is the pooling or interest method? Pooling or interest method is a method of accounting for a business combination in which the combining companies are treated as if their net assets were pooled instead of one company having purchased outright the other. Assets and liabilities are combined at their net book value.

Prior period adjustments definition

What is meant by the prior period adjustments? Prior period adjustments are the transactions that relate to an earlier accounting period but that were not determinable by management in the earlier period. Specifically limited by a FASB statement.

Proxy term definition

What is meant by the term “Proxy”? Proxy is a legal document signed by the shareholders that gives another individual or individuals, usually existing management, the right to vote the shares in the manner they deem best.

Par value definition

What is Par Value? Par value is an amount designated in the articles of incorporation or by the board of directors and printed on the stock certificate.

Present Value Definition

What is meant by Present Value? The amount that must be invested now, at a given rate of interest, to produce a given future value is called present value.

Patent term definition

What is meant by the term “Patent”? The patent is an exclusive right to use, manufacture, process or sell a product that is granted by the US Patent Office.

Percentage of Net sales method

What is the percentage of the net sales Method? – Definition Percentage of Net Sales is a method of estimating uncollectible accounts expense under which the amount of uncollectible accounts expense is determined by the analysis of the relationship between net credit sales and the prior year’s uncollectible accounts expense. Explanation The percentage-of-net-sales method determines …

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Post Closing Trial Balance Definition

What is Post Closing Trial Balance? Post Closing Trial Balance is a trial balance prepared from the ledger account after the closing entries have been posted. Used to help ensure that these entries have been posted correctly.

Period Expenses Defintion

What is mean by accounting term “Period Expenses”? Period expenses are the expenses of a business that cannot be directly related to a product or services and matched against revenues in the period the revenues are earned.

Posting Definition

What is meant by accounting term Posting? Posting is the process of transferring information from journal entries to the ledger accounts.

Publicly Owned term Meanings

What is meant by the term Publicly Owned? Publicly owned is a term indicating that a corporation’s stock is traded on an organized exchange (such as the New York or American Stock Exchange), easily enabling individuals to buy or sell shares of stock in these corporations.

Purchases Allownace

Definition If the purchaser informs the supplier that some goods are defective or damaged or not according to specification, the supplier may agree to reduce the price of such goods. This reduction in price is known as purchases allowance.

Purchases Discount

Definition The concession allowed by the supplier on the purchase of goods is called purchases discount. Or The allowance given for prompt payment for merchandise purchased for resale. Example John Foods (Pvt) Limited announced 10% to 25% discount on its all products from 1st January to 20 January 2019. When you will purchase some products …

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Purchases

Definition In Accounting, purchases do not mean buying anything but it has special meaning. When saleable goods or merchandise are bought in a business these are called purchases. Example Stationery is purchased by a stationer is called “Purchases” Cloth purchased by a cloth merchant is called “Purchases” Cement purchased by a cement dealer is called …

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Proprietor

Definition We can define Proprietor as: “He is the owner of the business. He invests his capital, gives his time and attention to the business. He enjoys profit and bear loss of the business.”

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