Basic Accounting terms (Hindi to lesson, terms lang talaga)

Transaction

Any business deal involving money

Goods/Services

Physical Items bought and sold; Work or help offered

Profit

refers to money gained

Loss

Refers to Money lost

Asset

Something the business owns that has value

Current assets

Assets used or turned into each soon

Non-current Assets

Long-term assets

Liability

Money the business owes

Current Liabilities

Debts due soon

Non-current liabilities

Long-term debts

Internal Liability

Owners’ share in the business

Working Capital

Money/resources used for daily operations

Contingent Liability

Possible future debt (depends on something happening)

Capital

Owner’s investment in the business

Drawings

Money or assets taken by the owner for personal use

Net Worth

Total Value of the business after debt

Non-current investments

Refers to Long-term investments

Current Investments

Refers to short-term investments

Debtor

Person who owes the business money

Creditor

Person the business owes money to

Capital Expenditure

Spending on long-term assets

Revenue Expenditure

Spending for daily operations

Balance sheet

A snapshot of what the business owns and owes

Income statement

Shows the profit or loss

Trade Discount

Price reduction for bulk/business buyers

Cash Discount

Discount for paying early.