A dishonored note is a note that is not paid in full at maturity. A dishonored note receivable is no longer negotiable. However, the payee still has a claim against the maker of the note. Therefore the note holder usually transfers the Notes Receivable account to an Account receivable.
More from this Section
- Return on assets
Return on assets is an overall measure of profitability computed by dividing net income by average assets.
The largest intangible asset that appears on a company’s balance sheet is goodwill. Goodwill represents the value of all favorable attributes that relate to a company.
- Direct and indirect fixed costs
A profit center may have both direct and indirect fixed costs. Direct fixed costs relate specifically to one center are incurred for the sole benefit of that center.
- Production budget
Production budget is a projection of the units that must be produced to meet anticipated sales. Production requirements are determined form the following formula.
Premium is the difference between the selling price and the fact value of a bond/stock, when the bond/stock is sold for more than its face value.
- Multiple-step income statement
The multiple-step income statement is an income statement that shows several steps in determining net income.
Conservatism which means that the best choice among accounting alternatives is the method that is least likely to overstate assets and net income.