| Term | Definition |
|---|
| Accelerated Depreciation | Any method of depreciation used for accounting or income tax purposes that allow greater deductions in the earlier years of the life of an asset. |
| Accounting Activity Routine / Accounting Cycle | The sequence of accounting activities performed during an accounting period. |
| Accounting Period | The period of time covered by an income statement. One year is the accounting period for much financial reporting, but financial statements are also prepared by most companies for each quarter and each month. |
| Accrual Basis of Accounting | The practice of recording revenue in the period in which it is earned and recording expenses in the period in which they are incurred. The effect on the business is recognized as goods or services are rendered or consumed, rather than when cash is received or paid. |
| Accumulated Depreciation | The total amount of recorded for an asset since its date of acquisition. |
| Acquisition Costs | The value of resources used to obtain an asset. These costs may be paid by short and long term debt, equity, cash, and can include both tangible and intangible costs. |
| Amortization | Paying off a debt in regular installments over a period of time. |
| Applied Credit | In Accounts Receivable, a credit memo that reduces the amount remaining to be paid on a specific debit item, instead of merely reducing the total amount owed on the account. |
| Applied Debit | In Accounts Payable, a credit memo that reduces the amount remaining to be paid on a specific credit item, instead of merely reducing the total amount owed on the account. |
| Applied Payment | In Accounts Receivable, a payment that reduces the amount remaining to be paid on a specific debit item, instead of merely reducing the total amount owed on the account. |
| Apply Type | This is established when adding Benefit/Deduction/Addition/Tip Codes to PR employee master records. The Apply type specifies how a code calculates and applies each pay period. |
| AR Code | A two-character alphanumeric code attached to customer master records and used to categorize customers. The AR Code is used in the Interface Table to specify a GL Accounts Receivable account. |
| Assets | The economic resources owned by a business for the purpose of conducting business operations. |
| Audit Process | An accounting activity involving the independent review of accounting records to ensure accuracy of those records. The audit process is aimed at finding any deviations from generally accepted accounting principles. |
| Audit Trail | The documentation of transactions for use by consumers and auditors of financial statements to substantiate the authenticity and accuracy of the financial statements. Also, a report available in the General Ledger module that provides a chronological listing by account of the entries posted to each account. |
| Backups | Periodically updated copies of computer data that ensure against total loss of data from a catastrophic event. |
| Balance Forward | An AR customer type specified by the AR Code in which all open invoices are compacted into a single monthly balance at the end of each month. See Also Open Item. |
| Bank Reconciliation | A report, or the process of preparing it, that lists the outstanding items comprising the difference between the bank statement balance and the company checkbook balance. |
| Batch Processing | A transaction processing method that allows for multiple transactions to be entered and edited prior to posting. |
| Batch Status | The activity status associated with each batch of transactions. The status is viewable through the Batch Status Report for modules set up for multiple batch processing. A batch of transaction can be accessible and able to accept additional transactions or inaccessible because posting has been initiated. |
| Batch Type | Batch types are identified in the Batch Status Reports, with each type of batch containing different transaction types. In Order Entry and Point of Sale, there are two types of batches, invoice transaction batches and recurring batches. In Accounts Payable, there are invoice batches and payment batches. |
| Beginning Inventory | The book value of goods, inputs, or materials available for use or sale at the beginning of an inventory accounting period. |
| Benefit | Benefit earned by employee such as; vacation, sick-leave, insurance, bonus, etc. |
| Calendar Month or Year | A period of the Gregorian calendar of time measurement beginning on January 1 and ending on December 31. |
| Cash Basis of Accounting | The practice of recording revenue when received in cash and recording expenses when they are paid in cash. |
| Cash Flow Statement | A statement of sources of cash receipts and purpose of cash disbursements used to explain the change in the Cash account balance. |
| Cash Key | An indicator that identifies a transaction as a cash transaction and determines which General Ledger Cash account is affected. |
| Cash Sale Invoice | An invoice that documents the exchange of goods or services for cash or a cash instrument such as check, credit card, money order, or bank draft. |
| Charge Sale Invoice | An invoice that documents the exchange of goods or services for a promise of future payment. |
| Chart of Accounts | A list of the General Ledger accounts and corresponding account numbers used to record the events of a business. |
| Closing Entries | Journal entries made at the end of the year for closing revenue and expense accounts and transferring the balance to the owner’s capital account (Retained Earnings). |
| CMS Date | The CMS Date (or system date) is the date that all modules and software use by default. This date is set each time the software is opened. |
| Committed | In Inventory, the process of deducting the quantity of stock items that have been included in a transaction that has been saved but not posted from the available quantity of that stock item. Once the sales transaction has been posted, the Committed quantity is subtracted from the on-hand quantity, the on-hand quantity is updated, and the committed quantity is reset to zero. For example, if there are 20 widgets in stock and the clerk sells 4 over the course of the day, then the onhand quantity of the item will still reflect 20, but the Available quantity (which is what appears when you open the stock item lookup when selling an item) will reflect 16, since 4 have been committed. Once the transactions for the day have been posted, the committed quantity is reset to zero, and the on-hand quantity is adjusted to 16, which will match the Available Quantity until more transactions which include that stock item are saved. |
| Company Templates | A set of ledgers, accounts, and data files already set up in the accounting program for a company to adopt to their own purposes. These templates eliminate a great deal of the work required in setting up a new company in the accounting program. |
| Consolidated Financial Statements | Financial statements presenting the combined financial position and operating results of affiliated companies. |
| Context-Sensitive Help | Online instructional and explanatory text that is relevant to the specific operation being performed. Help is available throughout the software and changes with the screen and cursor position to coincide with the task at hand. A help button is available in some screens, and the default help key is F1. |
| Contra Account | A ledger account which is deducted from a related account. |
| Contra-Asset Account | An account with a credit balance that offsets an asset account to reflect the appropriate balance sheet value for the asset. |
| Credit | An amount entered in the right-hand column of a ledger account. A credit decreases an asset or expense account balance, and increases a liability, equity, or income account balance. |
| Credit Memo | A document issued that reduces the amount of a receivable or increases the amount of a payable. These are used to record returned goods, defective goods or services, miscellaneous charges or credits, and error corrections. |
| Custom Companies | Companies established from scratch in which you set up all Profile variables required for operation. |
| Days to Lose Discount | The number of days after a sale that an early payment discount is available. |
| Debit | A debit increases an asset or expense account balance, and decreases a liability, equity, or income account balance. |
| Debit Memo | A document issued that reduces the amount of a payable. These are used to record returned goods, defective goods or services, miscellaneous charges or credits, and error corrections. |
| Deduction | Sum or amount deducted from pre-tax or after-tax wages. |
| Default Entry | A value placed in a data entry field that is recorded as the entry to the field unless overridden to a different value. |
| Department Code | A Profile Code that defines the sales departments within a company. Department Codes determine which General Ledger income accounts are affected by a sales transaction. |
| Depreciation | An expense recorded to reduce the value of a long-term tangible asset. Since it is a non-cash expense, it increases free cash flow while decreasing reported earnings. |
| Detail Line Type | The type of transaction item entered on a particular line of a transaction document. Detail Section That portion of a transaction document that shows the itemized detail of the transaction. |
| Discount Code | A two part code established in Order Entry or Point of Sale which specifies a discount percentage by inventory item and customer. One half of the code is entered on the customer master record and the other half is entered as part of each Inventory master record. |
| Documents | The original evidence of a business transaction such as checks, sales receipts, or a cash register tape. |
| Double-Entry Accounting System | A system in which the total dollar amount of debits must equal the total dollar amount of credits. |
| Due Date Control | An indicator that specifies how the due date of a payable is determined. For instance, a due date can be determined by counting off a number of days from the transaction date or from the first day of the next month. |
| Due Date Days | The number of days used in conjunction with the due date control to determine the due date of a payable. |
| Earnings | Wages, salary, or other recompense earned by working. |
| Edit Report | A listing of entered but not posted transactions for checking the accuracy of the data entry work. |
| EFT (Payroll) | Electronic Funds Transfer. The electronic transfer of funds from one bank account to another via modem in an encrypted format. Charges are made automatically through the Federal Reserve’s automated Clearing House (ACH). |
| EFTPS (Payroll) | Electronic Federal Tax Payment System, must be used to make electronic deposits. |
| EIC (Payroll) | Earned Income Credit |
| EIN (Payroll) | Employer Identification Number |
| Ending Inventory | A book value of goods, inputs, or materials available for use or sale at the end of an inventory accounting period. |
| Entire Accounting Cycle | The sequence of accounting activities performed during an accounting period. |
| Equity | See owner’s equity. |
| Exceptions Report | Any report that emphasizes the abnormal rather than the normal status. In Accounts Payable, the Cash Requirements Report can be considered an exceptions report since it shows invoices that are due but not paid. |
| Expense | The cost of goods or services used up for the purpose of generating revenue. |
| Expense Allocation | The process of allocating indirect expenses of a business among departments to measure the performance of each department. |
| Extended Price | The result when the quantity invoiced is multiplied by the price per unit. The total for a detail line on an invoice. |
| Factor | A secondary party attached to an Accounts Payable vendor to whom you make invoice payments. If a vendor is factored, you typically purchase items from the vendor, but make payments for those items to the associated factor. |
| FICA (Payroll) | Federal Insurance Contributions Act Social Security. Tax paid equally by employee and employer |
| FIFO (first in, first out) | An inventory valuation method based on the assumption that the first item acquired is the first item sold, and that the remaining items are the most recently acquired. |
| Finished Good | A product that is created by combining other items. The Finished Good has completed the manufacturing and/or assembly process and is ready for sale. |
| Finished Goods Inventory | Goods that have been manufactured but have not yet shipped. |
| Flag (noun) | A flag is an indicator that can be set to signify one of a small number of possible conditions. Flags are most commonly used to signify which of an either-or situation exists. For instance, a journal entry is either a debit or a credit. When entering journal entries, we set a flag to 0 to signify a debit or to 1 to signify a credit. |
| Flag (verb) | To set a flag on a data record. Usually used when one particular flag setting indicates a need for special attention. |
| Form 940 (Payroll) | Employer’s Annual Federal Unemployment (FUTA) Tax Return. |
| Form 941(Payroll) | Employer’s Quarterly Federal Tax Return. |
| Form 945 (Payroll) | Annual Return of Withheld Federal Income Tax. |
| FUTA (Payroll) | Federal Unemployment Tax (see Form 940). |
| Fund Accounting | A system of accounting used primarily by nonprofit or government organizations, emphasizing records of how their money was spent, instead of how it was earned, unlike corporations. |
| GL Key | Two character alphanumeric entries found in various codes throughout the accounting modules that are used in the Interface Table to specify an associated GL account. |
| Gross Profit on Sales | The result when the cost of goods sold is subtracted from the revenue from sales. |
| Header Section | The portion of a transaction document that contains general transaction information applying to all aspects of the transaction. Header information includes items such as names and addresses of the parties involved, the transaction date, and payment terms. |
| Held Invoice | A sales invoice that is retained in the batch for further action. A held transaction remains in the batch and does not post until it is retrieved and released. |
| Historic Transactions | Transactions from the past that are entered to provide an accurate history of business operations. These transactions commonly were recorded in some other accounting system and now are being entered in the new system so as to be reflected in reports generated from the new system. |
| Income | Revenue resulting from the operations of a business. |
| Intangible Asset | An asset that is not physical in nature. An example is a copyrights or goodwill. |
| Integrations | Indicators set within the Module Preferences window of each module that specifies communication of posted information between modules. |
| Interface Code | A combination of determinants that represents a combination of circumstances surrounding a transaction. It specifies which General Ledger accounts are affected by a transaction conducted under the associated set of circumstances. |
| Interface Key | Often used interchangeably with GL Key. See GL Key. |
| Interface Table | A cumulative table of Application Interface Codes that directs posting of transactions from Order Entry, Point of Sale and Accounts Receivable to the appropriate General Ledger accounts. It is analogous to a lookup table that contains every possible set of transaction circumstances and the accounts affected by transactions conducted under each set of circumstances. |
| Inventory | Goods being held for resale. In manufacturing, can be raw materials, goods in process or finished goods. |
| Inventory Turnover Ratio | An indicator of how many times inventory was totally replaced during the year. The formula is: Inventory Turnover Ratio = cost of goods sold / average inventory. |
| Inventory Valuation Method | The practice used to assign costs to Inventory items sold. |
| Invoice | An itemized statement of goods or services sold that shows quantities, prices, total charges, payment terms, and sales tax. An invoice might also include many other items of information such as item description. The invoice serves as the original evidence of ownership transfer for both the buyer and seller. |
| Invoice Only Transaction | A Purchase Order transaction that invoices items that were previously received into Inventory but not invoiced. |
| Journal | A record of transactions that show the accounts and amounts of both the debit side and credit side of the entry. |
| Journal Entry | A single entry of a transaction in that records the account and amount for both debit side and credit side to be recorded in the general ledger. Also includes a short description of the transaction. |
| Landing Costs | The costs of acquiring inventory besides the purchase cost. Sales tax and freight charges can be landing costs. |
| LIFO (last in, first out) | An inventory valuation method based on the assumption that the last item acquired is the first item sold, and that the remaining items are the first acquired. |
| Liabilities | The claims against the assets of a business. The debts or financial obligations of a business. |
| Line Item Types | The different types of transactions that can be documented on a detail line of an invoice. |
| Long-term Liability | An obligation that will take longer than one year to satisfy. |
| Magnetic Media (Payroll) | Method of saving data in a report format to tape or disk in order to submit the report electronically, rather than on paper. |
| Master Files | The files that hold the records containing general information about the participants or objects of transactions within a module. In General Ledger the master file contains the account names, numbers, and balances. In Accounts Receivable the master file contains the customer names, numbers, balances, and other general information. In Inventory the master file contains the inventory item descriptions, stock numbers, and cost and quantity information. |
| Master Records | The individual records found in a master file. General information about the participants or objects of transactions within a module. |
| Module | One of the functional applications of Cougar Mountain Software for Windows. Modules available are General Ledger, Accounts Receivable, Accounts Payable, Order Entry, Point of Sale, Inventory, Payroll, Bank Reconciliation, and Data Exchange. |
| Nested Tax Codes | A set of Sales Tax Codes that are set up to charge tax on a sale for more than one taxing agency. The total for all agencies is assessed on the sale, and the amounts for the individual agencies are recorded separately. |
| Non-Inventory Code | A Profile Code that defines product categories that are not Inventory items. |
| Nonprofit Organization | An association that is given tax-free status. Donations to a non-profit organization are often tax deductible as well. |
| Note | A written obligation to pay a specific sum of money, within a specific period, at a certain rate of interest. |
| Note Payable | A debt owed to a lender and evidenced by a written promise of payment. Note payable, an entry on the liabilities side of many corporate balance sheets, indicates that a certain dollar amount of loans will be repaid to the lenders at a future time. |
| Note Receivable | A debt due from borrowers and evidenced by a written promise of payment. Note receivable, an entry on the asset side of many corporate balance sheets, indicates the dollar amount of loans due to be repaid by borrowers. |
| Open Item | A line item from a receivable or payable transaction that has an amount remaining to be paid or applied. |
| Operating Capital | Current assets minus current liabilities. The net amount of liquid resources available to finance business operations. |
| Operating Expenses | Costs associated with the operation and maintenance of an income producing property. |
| Operating Income | The difference between gross profit and operating expenses. Referred to as net operating income; the subtotal before net profit. |
| Operator Identity | A label attached to an invoice batch to identify the transactions in the batch. |
| Orientation | Used to define how a report will print, such as Portrait (oriented vertically) or Landscape (oriented horizontally). |
| Other Assets | Assets of relatively small value. For financial reporting purposes, firms frequently combine small assets into a single category rather than listing each item separately. |
| Other Time | In Payroll, units worked at other than the regular pay rate, such as overtime units. |
| Outstanding Checks | Checks issued on a bank account that have not been presented to the bank for payment. |
| Owner’s Draw | Amounts of cash or other assets removed from the business by the owner and/ or the account used to record them. |
| Owner’s Equity | The resources invested in a business by the owner plus profits retained in the business. The amount by which the assets of a company exceed liabilities. |
| Paid Out | An Accounts Payable invoice paid to a vendor that does not have a vendor record established in the AP module. Also, a PO made out to a vendor that does not have a vendor record established in the AP module. |
| Periodic | Occurring at regular time intervals. |
| Periodic Activity Cycle | A set of company specific transactions that reoccur on a regular basis, usually monthly but sometimes quarterly and even yearly. |
| Perpetual Inventory | An accounting method of maintaining up-to-date property records that accurately reflect the level of goods on hand. |
| Posting | The process of recording the effects of transactions in the general and subsidiary ledgers. |
| Prepaid Expenses | Expenses, such as rent and insurance, which are paid in advance. The unused portion of prepaid expenses are a balance sheet asset. |
| Principal | The amount borrowed or the amount still owed on a loan, separate from interest. Or, the original amount invested separate from earnings. |
| Profile Codes | Data records that define the company operations. These records are relatively unchanging and general in scope. They define such things as departments within a company, product categories, payables categories, receivables categories, and company policies. |
| Profit | The amount by which the revenue from business operations exceeds the cost of operations. |
| Raw Materials Inventory | Inventory that will be used to manufacture a product. |
| Recurring Batch | A transaction batch that holds template invoices that can be generated time after time. It is used to invoice periodically recurring transactions without having to retype the information each time. |
| Retained Earnings | The portion of owner or stockholder equity that is a result of profit earned by the business. |
| Short-term Liability | An obligation that will take less than one year to satisfy. |
| Single Entry | A method of accounting that does not use a two-sided ledger to capture financial data instead only noting amounts owed by and due to a business. |
| Social Security Taxes | Federal tax levied equally on employers and employees, used to pay for Social Security programs. |
| SQL | Structured Query Language. This is the language that most database systems use to manipulate data in a specific way. |
| SSN (Payroll) | Social Security Number |
| Stand-Alone Module | A module of the accounting program that does not interact with other modules. Any of the modules can be used as stand-alone or as elements of a fully integrated accounting system. |
| Standard Cost | An Inventory valuation method by which the cost assigned to an Inventory item at the time of sale is a predetermined estimate. When the actual cost is recognized, any variance between standard and actual costs is posted to an inventory variance account and an expense adjustment account. |
| Statement of Cash Flow | A financial statement listing how a firm has obtained its funds and how it has spent them within a period of time. |
| Statement of Income and Expense | A financial statement that shows the revenues, expenses, and net income for a given accounting period. |
| Straight-line Depreciation | A method of calculating the depreciation of an asset that assumes the asset will lose an equal amount of value each year of its useful life. |
| Taxable Income | The amount of income subject to income tax (adjustments, deductions, and exemptions) by the IRS or state taxing authorities. |
| Terms Code | A Profile Code in Accounts Receivable that outlines terms for early payment discounts and finance charges. When a Terms Code is attached to a transaction, the terms specified in the code apply to the transaction. |
| Tips (Payroll) | A gratuity paid in addition to earned wages. |
| Trailer Character | A designated character that always follows a printed field on a document. |
| Trailer Spaces | A designated number of blank spaces that follow a printed field on a document |
| Transaction | An agreement between a buyer and a seller for the exchange of goods or services for payment that is recorded in the accounting records. |
| Transaction Batch | A group of transactions that will be posted together. |
| Transactions | Business events which can be measured in money. |
| Turnover | The number of times inventory or accounts receivable are replaced during a year. |
| Unapplied Credit | A credit in Accounts Receivable that reduces the total amount owed by the customer, but does not reduce the amount remaining to be paid on a specific debit item. The unapplied item is an open item until the full amount is applied. |
| Unapplied Debit | A debit in Accounts Payable that reduces the amount owed a vendor, but does not reduce the amount remaining to paid on a specific credit item. The unapplied item is an open item until the full amount is applied. |
| Unapplied Payment | A payment in Accounts Receivable that reduces the total amount owed by the customer, but does not reduce the amount remaining to be paid on a specific debit item. The unapplied item is an open item until the full amount is applied. |
| Under Capitalized | To provide an insufficient amount of capital for (a business enterprise). |
| Unearned Revenue | When an individual or company receives money for a service or product that has yet to be fulfilled. |
| Units (Payroll) | The number by which the pay rate is multiplied to calculate gross pay. The most commonly used units in Payroll calculations are hours, but other measures of time or production can be used. |
| Universal Bridge | The Cougar Mountain feature that imports unposted transactions from an external file. Modules that support this feature are General Ledger, Accounts Receivable, Accounts Payable, Inventory, Order Entry, Payroll, and Bank Reconciliation. |
| User Interface | The means by which a computer user exchanges information with the computer. The menu and data entry screens are good examples of user interface. |
| Variance | The difference between an actual amount and a budgeted amount. |
| Vendor | A supplier of goods or services. |
| W-2 (Payroll) | Employee wage and tax statement, provided by the employer to the employee. |
| W-3 (Payroll) | Transmittal of Wage and Tax Statements. Information filed with the Social Security Administration by the employer. |
| Weighted Average Cost Method | This method of inventory valuation divides the total cost of stock items available to sell by the number of units available. |
| Withholding | An amount deducted by an employer from an employee's gross wage earnings before he or she receives the funds. |
| Work in Process Inventory | Raw materials are processed but the product is not yet a finished good. |
