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Accounting Vocab
| Term | Definition |
|---|---|
| Asset | Anything of value that is owned |
| Liability | An amount owed by a business |
| Withdrawals | Assets taken out of a business for the owner's personal use |
| Adjustments | Changes recorded on a work sheet to update general ledger amounts at the end of a fiscal period |
| Expense | A decrease in owner's Equity from the operation of a business |
| Revenue | An increase in owner's Equity resulting from the operation of a business |
| Net Income | The difference between total revenue and total expenses when the total revenue is greater |
| Net Loss | The difference between total revenue and total expenses when expenses are greater |
| Owner's Equity | The amount remaining after the value of all liabilities is subtracted from the value of all assets |
| Account | A record summarizing all the information pertaining to a single item in the accounting equation |
| Accounting Equation | An equation showing the relationship among assets, liabilities, and owner's equity |
| Account Number | The number assigned to an account |
| Capital | The account used to summarize the owner's equity in a business |
| Temporary Accounts | Accounts used to accumulate information until it is transferred to the owner's equity capital account |
| Income Summary | The temporary Account used to close out the temporary Accounts that affect owner's equity at the end of a fiscal period |
| Account Balance | The amount in an account |
| Financial Statement | Financial reports that summarize the financial condition and operation of a business |
| Sale on Account | A sale for which cash will be received at a later date |
| Transaction | A business transaction activity that changes assets, liabilities, or owner's equity |
| Account Title | The name given to an account |
| Debit | An amount recorded on the left side of a T account |
| Credit | An amount recorded on the right side of a T account |
| Normal Balance | The side of the account that is increased |
| Check | A business form ordering a bank to pay cash from a bank account |
| Invoice | A form describing the goods or services sold, the quantity, and the price |
| Journal | A form for recording transactions in chronological order |
| Memorandum | A form on which a brief message is written describing the transaction |
| Receipt | A business form giving written acknowledgement for cash recieved |
| General Amount Column | A journal amount column that is not headed with an account title |
| Special Amount Column | A journal amount column that is headed with an account title |
| Posting | Transferring information from a journal entry to ledger account |
| Bank Statement | A report of deposits, withdrawals, and bank balances sent to a depositor by a bank |
| Checking account | A bank account from which payments can be ordered by a depositor |
| Dishonored Check | A check that a bank refuses to pay |
| Electronic Funds Transfer | A computerized cash payment system that transfers funds without the use of checks, currency, or other paper documents |
| Endorsement | A signature or stamp on the back of check, transferring ownership |
| Petty Cash | An amount of cash kept on hand and used for making small payments |
| Balance Sheet | A financial statement that reports assets, liabilities, and owner's equity on a specific date |
| Income Statement | A financial statement showing the revenue and expenses for a fiscal period |
| Work Sheet | A columnar accounting form used to summarize the general ledger information needed to prepare financial statements |
| Trial Balance | A proof of equality of debits and credits in a general ledger |
| Accounting Cycle | The series of accounting activities included in recording financial information for a fiscal period |
| Adjusting Entries | Journal entries recorded to update general ledger accounts at the end of a fiscal period |
| Closing Entries | Journal entries used to prepare temporary Accounts for a new fiscal period |
| Post-Closing Trial Balance | A trial Balance prepared after the closing entries are posted |
Created by:
boniceth000
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