MATCHING Instructions Designate the terminology that best represents the definition or statement given below by placing the identifying letter(s) in the space provided. No letter should be used more than once. A. Additions and improvements X. Full disclosure principle B. Allowance method Y. Going-concern assumption C. Amortization Z. Held-to-maturity securities D. Available-for-sale securities AA. Internal control E. Average cost method AB. Last-in, first-out method F. Book value AC. LIFO reserve G. Capital expenditure AD. Matching principle H. Cash debt coverage ratio AE. Materiality I. Consistency AF. Monetary unit assumption J. Contra asset account AG. Net purchases K. Cost method AH. Periodic inventory system L. Credit memorandum AI. Permanent accounts M. Debit memorandum AJ. Perpetual inventory system N. Declining-balance method AK. Ratio analysis O. Depreciable Cost AL. Relevance P. Depreciation AM. Reliability Q. Direct write-off method AN. Revenue expenditure R. Discontinued operations AO. Revenue recognition principle S. Earnings per share AP. Stock dividend T. Economic entity assumption AQ. Stock split U. Equity method AR. Temporary accounts V. Extraordinary items AS. Time period assumption W. First-in, first-out method AT. Units-of-activity method ___ 1. The periodic write-off of an intangible asset. ___ 2. The total amount subject to depreciation. ___ 3. The principle that efforts be matched with accomplishments. ___ 4. An expenditure charged against revenues as an expense when incurred. ___ 5. The inventory costing method that assumes that the costs of the earliest goods purchased are the first to be recognized as cost of goods sold. ___ 6. Use of the same accounting principles and methods from period to period by the same business enterprise. ___ 7. A measure of solvency calculated as cash provided by operating activities divided by average total liabilities. ___ 8. An inventory costing method that assumes that the latest units purchased are the first to be allocated to cost of goods sold. ___ 9. An assumption that economic events can be identified with a particular unit of accountability. PART II MATCHING (cont.) ___ 10. A characteristic of information that means it is capable of making a difference in a decision. ___ 11. An assumption that the economic life of a business can be divided into artificial time periods. ___ 12. This method of accounting for uncollectible accounts is required when bad debts are significant in size. ___ 13. Used by a bank when a previously deposited customers check bounces because of insufficient funds. ___ 14. The assumption that the enterprise will continue in operation long enough to carry out its existing objectives and commitments. ___ 15. A system in which detailed records are not maintained and cost of goods sold is determined only at the end of an accounting period. ___ 16. The methods and measures adopted within a business to safeguard its assets and enhance the accuracy and reliability of its accounting records. ___ 17. Revenue, expense, and dividends accounts whose balances are transferred to retained earnings at the end of an accounting period. ___ 18. A technique for evaluating financial statements that expresses the relationship among selected financial statement data. ___ 19. A pro rata distribution of a corporations own stock to its stockholders. ___ 20. The net income earned by each share of outstanding common stock