chapter 6

5. management concerned with optimum utilization of resources
7. method journalizes income and expenditures at the time they occur even if no money changes hands at that time
8. sheet captures the business's financial condition at a particular moment--somewhat like a photograph captures just one second of time
10. investment decisions, decisions that determine which projects a business will invest in how the investment(s) will be financed and whether or not to pay dividends to shareholders
13. the process of keeping financial records
14. analyzing financial transactions journalizing transactions posting to ledger and balancing the books
16. on capital a measure of how well a business generates cash flow in relation to the capital it has already invested in itself
17. the books the final step of the accounting cycle involves closing any temporary accounts and transferring the temporary account balances to permanent accounts such as owner's equity
18. flow statement financial summary estimating when where and how much money will flow into and out of a business during a specific period of time
19. anything of value that the business owns

1. capital management management of a firm’s current balance of assets and liabilities...involves accounts payable and receivable inventory and cash
2. balance listing of the business's different accounts and their current balances, found in the different ledgers
3. the process of obtaining funds and using them to achieve the goals of the business
4. special book or computer program in which transactions are recorded in the order that they occur
6. records show the business's financial health
9. debts that the business owes
11. conversion cycle of working capital management ratio that refers to the number of days between a company’s paying for raw materials and receiving cash from selling the products made from those raw materials
12. statement shows how much money the business has made or lost during a specific period of time
15. equity amount the owner has invested in the business, plus or minus profits and losses
18. accounting method records income and expenditures at the time the money changes hands