CONTRA ACCOUNT Definition

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CONTRA ACCOUNT is a. the reduction to the gross cost of an asset to arrive at the net cost; also known as a valuation allowance; e.g., accumulated depreciation is a contra account to the original cost of a fixed asset to arrive at the book value; or, b. reduction of a liability to arrive at its carrying value; e.g., bond discount, which is a reduction of bonds payable.

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SOP is Statements of Position (within the AICPA or FASB) or Standard Operating Procedure.

DEBT TO TOTAL ASSETS RATIO measures the percentage of assets financed by all terms of debt, includes both current and long term debt.

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