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WHS PoBF 6.01A
LAP FI 05
| Term | Definition |
|---|---|
| Accountant | An individual who has had specialized training in accounting procedures |
| Accounting | The process of keeping financial records |
| Accounting department | A special department responsible for the firm’s accounting records |
| Accounting system | The methods and procedures used in handling the business’s financial information |
| Accounts receivable | Monies owed to a business by its customers |
| Accrual accounting method | A method of accounting that records transactions at the time they occur even if no money changes hands at the time |
| Assets | Anything of value that a business owns |
| Balance sheet | A financial statement that captures the financial condition of the business at that particular moment |
| Bookkeeping | The step in the accounting process that actually records the business’s financial information |
| Cash | Currency and coins |
| Cash accounting method | An accounting method in which income and expenditures are recorded at the time the money changes hands |
| Cost of goods | The amount of money a business pays for the products it sells or for the raw materials from which it produces goods to sell |
| Credit | The arrangement by which businesses or individuals can purchase now and pay later |
| Creditors | Individuals or businesses to whom a business owes money or from whom it wants to borrow money |
| Current liabilities | Debts that must be paid within a year |
| Debts | Amounts of money businesses or individuals owe to others |
| Disbursement journal | An accounting record for recording daily expenditures |
| Economic forecast | A prediction of what may happen in the nation’s economy |
| Expenses | The monies that a business spends |
| Financial statement | A summary of accounting information |
| Fixed assets | Items of value a business owns that are not expected to change, e.g., buildings |
| Income | Money received by a business or an individual from outside sources |
| Income statement | A financial summary that shows how much money the business has made or has lost; also called the profit-and-loss statement |
| Investors | Those who invest their funds in a business; may be owners or stockholders |
| Journal | A special book or computer program in which a business’s transactions are recorded in the order in which they occur |
| Ledger | The accounting record for a specific department or area of the business |
| Liabilities | Debts that the business owes |
| Long-term liabilities | Debts that will take longer than a year to pay, e.g., a mortgage |
| Managers | Individuals whose jobs involve carrying out management functions |
| Net worth | The total value of the business |
| Operating expenses | All of the expenses involved in running a business |
| Owner’s equity | The amount an owner has invested in the business plus or minus profits and losses |
| Posting | Transferring accounting information from a daily journal to the appropriate ledger |
| Product mix | The particular assortment of goods and services that a business offers in order to meet the needs of its market(s) and its company goals |
| Profit | Monetary reward a business owner receives for taking the risk of investing in business |
| Profit-and-loss statement | Income statement |
| Return on investment | Income received from an investment in a business |
| Sales journal | An accounting record used to record the business’s daily receipts |
| Sales revenues | Money that comes into the business from the sale of goods and services |
| Sales trends | The direction in which sales are moving, i.e., increasing or decreasing |
| Stockholders | Owners of stock; also known as shareholders |
| Transaction | A business activity such as a sale, a purchase, or a return |
Created by:
VNelsonWHS
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