Accounting: What the Numbers Mean 9th Edition by Wayne W McManus, Daniel F Viele, David H Marshall

Exercise 65

Following are a number of the key terms and concepts introduced in the chapter, along with a list of corresponding definitions. Match the appropriate letter for the key term or concept to each definition provided (items 1–10). Note that not all key terms and concepts will be used.

a. Contra asset	d. Allowance for Bad Debts (or Allowance for Uncollectible Accounts)
b. Aging of accounts receivable	e. Valuation account
c. Bad Debts Expense (or Uncollectible Accounts Expense)	f. Write-off
g. Internal control system	m. Inventory profits (or phantom profits)
h. Financial controls	n. Finished Goods Inventory
i. Administrative controls	o. Raw Materials Inventory
j. Prepaid insurance	p. Work in Process Inventory
k. Physical inventory	q. Prepaid expenses
l. Lower of cost or market	r. Deferral

__________ The process of counting the inventory on hand and determining its cost based on the inventory cost-flow assumption being used.