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.
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a. Petty cash
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k. Cash discount
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b. Bank reconciliation
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l. Credit terms
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c. Deposit in transit
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m. Notes receivable
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d. Outstanding check
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n. Collateral
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e. Bank service charge
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o. Cost-flow assumption
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f. Not sufficient funds (NSF) check
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p. Specific identification
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g. Imprest account
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q. First-in, first-out (FIFO)
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h. Short-term marketable securities
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r. Last-in, first-out (LIFO)
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i. Commercial paper
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s. Weighted average
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j. Perpetual system
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t. Periodic system
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1. The inventory cost-flow assumption based on an average of the cost of beginning inventory and the cost of purchases during the year (taking into account the quantity of items at each cost).
2. A formal document that supports the claim of one entity against another for an amount owed.
3. A check returned by the maker's bank because the account did not have enough funds to cover the check.
4. A check that has been recorded as a cash disbursement by the entity but that has not yet been processed by the bank.
5. A system of accounting for the movement of items into inventory and out to cost of goods sold that involves a continuous record of items received and items sold.
6. Investments made with cash not needed for current operations.
7. The process of bringing into agreement the balance in the Cash account in the entity's ledger and the balance reported on the bank statement.
8. A short-term security usually issued by a large, creditworthy corporation.
9. A bank deposit that has been recorded in the entity's Cash account but that does not appear on the bank statement because the bank received the deposit after the date of the statement.
10. The fee charged by a bank for maintaining the entity's checking account.