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Accounting Terms 1.0
Accounting Terms 1.00
| Term | Definition |
|---|---|
| ACCOUNTING | planning, recording, analyzing, and interpreting information |
| ASSET | anything of value that is owned |
| CAPITAL | the account used to summarize the own'ers equity in a business |
| CHECK STUB | a business form that orders a bank to pay cash from a bank account |
| COMPETENCE | accountants must be knowledgeable of their profession |
| CONFIDENTIALITY | accountants must not share private information regarding their clients |
| CREDIT | an amount recorded on the right side of a T-account |
| DEBIT | an amount recorded on the left side of a T-account |
| ENTRY | consists of four parts: date, debit, credit, and source document and is recorded in the journal for each transaction |
| EQUATION | assets=liabilities + owner's equity |
| EQUITIES | the financial rights to the assets of a business |
| EXPENSE | a decrease in the owner's equity resulting from the operation of a business |
| INDEPENDENCE | accountants do not have an interest or profit financially from the companies they audit |
| INTEGRITY | accountants choosing between right and wrong |
| INVOICE | contains the date of the transaction, quantity, description, cost of each item, and payment terms |
| JOURNAL | a form that is used to record transactions in chronological order |
| JOURNALIZING | the process of recording the transactions in a journal |
| LIABILITY | an amount owed by a business |
| MEMORANDUM | a form that contains a brief message describing a transaction |
| OBJECTIVITY | accountants must be impartial, honest, and free of personal conflicts |
| PROPRIETORSHIP | a business owned and controlled by one owner |
| RECEIPT | shows the date payment was made and in business, provided the name of the person or business that paid and the amount |
| REVENUE | an increase in owner's equity resulting from the operation of a business |
| SOURCE DOCUMENT | a business paper that contains the information needed to record the journal entry |
| T-ACCOUNT | an accounting device used to analyze transactions |
| TRANSACTION | a business activity that changes assets, liabilities, or owner's equity |
| WITHDRAWALS | assets taken out of a business for the owner's personal use |
| NORMAL BALANCE | the side of the account that is increased |
| CHART OF ACCOUNTS | a list of accounts used by a business |
| SERVICE BUSINESS | a business that performs an activity for a fee |
| SALE ON ACCOUNT | a sale for which cash will be received at a later date |
| CAPITAL | the account used to summarize the owner's equity in a business |
| REVENUE | an increase in owner's equity resulting from the operation of a business |
| ACCOUNTING RECORDS | organized summaries of a busineess's financial activities |
Created by:
tomlinc
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