JETRO CORPORATION

Notes to Financial Statement

CASH

A current asset account which includes currency, coins, checking accounts, and
undeposited checks received from customers. The amounts must be unrestricted.

PETTY CASH FUND

Petty cash is a small fund of cash kept on hand maintained by a custodian for
purchases or reimbursements too small to be worth submitting to the more rigorous purchase
and reimbursement procedures of a company or institution.

BANK RECONCILIATION

A bank reconciliation statement is a summary of banking and business activity that

reconciles an entitys bank account with its financial records. The statement outlines the
deposits, withdrawals, and other activity impacting a bank account for a specific period. A
bank reconciliation statement is a useful financial internal control tool used to thwart fraud

ACCOUNTS RECEIVABLE

Accounts receivable represents money owed by entities to the firm on the sale of
products or services on credit. In most business entities, accounts receivable is typically
executed by generating an invoice and either mailing or electronically delivering it to the
customer, who, in turn, must pay it within an established timeframe, called credit
terms or payment terms.

NOTES RECEIVABLE

Notes Receivable represents claims for which formal instruments of credit are issued
as evidence of debt, such as a promissory note. The credit instrument normally requires
the debtor to pay interest and extends for time periods of 30 days or longer. Notes receivable
are considered current assets if they are to be paid within 1 year, and non-current if they are
expected to be paid after one year.
INVESTMENT

An investment is an asset or item that is purchased with the hope that it will generate
income or will appreciate in the future. In an economic sense, an investment is the purchase
of goods that are not consumed today but are used in the future to create wealth. In finance,
an investment is a monetary asset purchased with the idea that the asset will provide income
in the future or will be sold at a higher price for a profit.
JETRO CORPORATION
Notes to Financial Statement

INVENTORIES

Inventory is the raw materials, work-in-process products and finished goods that are
considered to be the portion of a business's assets that are ready or will be ready for sale.
Inventory represents one of the most important assets of a business because the turnover of
inventory represents one of the primary sources of revenue generation and
subsequent earnings for the company's shareholders.

TREASURY SHARE

Shares issued in the name of the corporation. The shares are considered issued, but
not outstanding.Usually refers to stock that was once traded in the market but has since been
repurchased by the corporation. Treasury stock not considered when calculating dividends or
earnings per share

PROPERTY PLANT & EQUIPMENT

Property, plant, and equipment (PP&E) is tangible items that are expected to be used
in more than one period and that are used in production, for rental, or for administration. This
can include items acquired for safety or environmental reasons. In certain asset-intensive
industries, PP&E is the largest class of assets.

PREPAID EXPENSE

A prepaid expense is a type of asset that arises on a balance sheet as a result of

business making payments for goods and services to be received in the near future. While
prepaid expenses are initially recorded as assets, their value is expensed over time as the
benefit is received onto the income statement, because unlike conventional expenses, the
business will receive something of value in the near future.

ACCOUNTS PAYABLE

Accounts payable (AP) is an accounting entry that represents an entity's obligation to

pay off a short-term debt to its creditors. On many balance sheets, the accounts payable entry
appears under the heading current liabilities. Another common usage of AP refers to a
business department or division that is responsible for making payments owed by the
company to suppliers and other creditors.

BONDS PAYABLE

Bonds that are issued as payments for long term debt. Commonly used
by government agencies and corporations to represent a formal promise to pay both semi-
annual interest payments and the maturity amount by a pre-determined date.
JETRO CORPORATION
Notes to Financial Statement

MORTGAGE PAYABLE

A mortgage payable is the liability of a property owner to pay a loan that is secured
by property. From the perspective of the borrower, the mortgage is considered a long-term
liability. Any portion of the debt that is payable within the next 12 months is classified as a
short-term liability. The total amount due is the remaining unpaid principal on the loan.

SUBSCRIPTION RECEIVABLE

includes the amounts still to be collected from the employee or investor before the
company will issue the shares. Common or Preferred Stock Subscribed: includes the total
price to be paid for the subscribed securities.

CAPITAL STOCK

Capital stock is the common and preferred stock a company is authorized to issue
according to the corporate charter. Accountants define capital stock as one component of the
equity section in a company's balance sheet.

RETAINED EARNINGS

Retained earnings refer to the percentage of net earnings not paid out as dividends,
but retained by the company to be reinvested in its core business, or to pay debt. It is recorded
under shareholders' equity on the balance sheet.

SALES

A sale is a transaction between two parties where the buyer receives goods (tangible
or intangible), services and/or assets in exchange for money. It can also refer to an agreement
between a buyer and seller on the price of a security. A sale functions as a contract between
the buyer and seller of the selected good or service.