FABM 2 5 MAJOR ACCOUNTS w/ Account Titles

DRAWING / WITHDRAWALS

MONEY taken out by the OWNER for personal use.

RETAINED EARNINGS

ACCUMULATED PROFITS kept in the BUSINESS rather than distributed.

OWNER'S EQUITY

The OWNER'S TOTAL INTEREST in the BUSINESS ASSETS.

SALES REVENUE

INCOME from SELLING GOODS or PRODUCTS.

SERVICE REVENUE

INCOME earned from PROVIDING SERVICES.

INTEREST REVENUE

INCOME earned from INTEREST on INVESTMENTS or LOANS.

RENTAL REVENUE

INCOME from RENTING out PROPERTY or EQUIPMENT.

COMMISSION REVENUE

INCOME earned from COMMISSIONS on SALES made for OTHERS.

RENT EXPENSE

COST of RENTING PROPERTY or EQUIPMENT.

UTILITIES EXPENSE

COST of SERVICES like ELECTRICITY, WATER, and INTERNET.

SUPPLIES EXPENSE

COST of SUPPLIES consumed in OPERATIONS.

SALARIES EXPENSE

WAGES paid to EMPLOYEES.

DEPRECIATION EXPENSE

ALLOCATION of LONG-TERM ASSET COST over TIME.

INSURANCE EXPENSE

COST of INSURANCE used during the PERIOD.

ADVERTISING EXPENSE

COST of PROMOTING the BUSINESS.

INTEREST EXPENSE

COST of BORROWING MONEY (LOAN INTEREST).

REPAIRS AND MAINTENANCE EXPENSE

COST of FIXING or MAINTAINING ASSETS.

CASH

MONEY the BUSINESS has ON HAND or in the BANK, available for USE.

ACCOUNTS RECEIVABLE

MONEY OWED to the BUSINESS by CUSTOMERS for CREDIT SALES.

INVENTORY / MERCHANDISE INVENTORY

GOODS the BUSINESS holds for SALE to CUSTOMERS.

LAND

PROPERTY owned by the BUSINESS that usually DOES NOT DEPRECIATE.

EQUIPMENT

PHYSICAL ASSETS like MACHINES or TOOLS used in BUSINESS OPERATIONS.

SUPPLIES

ITEMS used in the BUSINESS that are NOT for SALE but CONSUMED.

PREPAID RENT

RENT PAID in ADVANCE, representing a FUTURE BENEFIT.

PREPAID INSURANCE

INSURANCE PREMIUMS paid in ADVANCE, considered an ASSET.

BUILDING

STRUCTURES owned by the BUSINESS, such as OFFICES or WAREHOUSES.

VEHICLES

CARS, TRUCKS, or OTHER VEHICLES owned and used by the BUSINESS.

ACCUMULATED DEPRECIATION

The TOTAL DEPRECIATION EXPENSE recorded AGAINST a FIXED ASSET to DATE, reducing the ASSET'S BOOK VALUE (CONTRA-ASSET).

ACCOUNTS PAYABLE

MONEY OWED to SUPPLIERS or VENDORS for CREDIT PURCHASES.

NOTES PAYABLE

WRITTEN PROMISES to PAY a certain AMOUNT by a SPECIFIC DATE (LOANS).

UNEARNED REVENUE

MONEY RECEIVED before GOODS or SERVICES are DELIVERED.

ACCRUED EXPENSES / ACCRUED LIABILITIES

EXPENSES INCURRED but NOT YET PAID (e.g., WAGES, UTILITIES).

INTEREST PAYABLE

INTEREST OWED but NOT YET PAID.

TAXES PAYABLE

TAXES OWED but NOT YET PAID to the GOVERNMENT.

SALARIES PAYABLE

WAGES OWED to EMPLOYEES that have NOT YET been PAID.

DIVIDENDS PAYABLE

DIVIDENDS declared but UNPAID to SHAREHOLDERS.

MORTGAGE PAYABLE

LONG-TERM DEBT secured by PROPERTY.

LOAN PAYABLE

AMOUNT OWED on LOANS from BANKS or LENDERS.

CAPITAL

OWNER'S INVESTMENTS in the BUSINESS.

ALL REVENUE ACCOUNTS

SALES REVENUE
SERVICE REVENUE,
INTEREST REVENUE,
RENTAL REVENUE,
COMMISSION REVENUE.

9 EXPENSE ACCOUNTS

RENT EXPENSE,
UTILITIES EXPENSE,
SUPPLIES EXPENSE,
SALARIES EXPENSE,
DEPRECIATION EXPENSE, INSURANCE EXPENSE,
ADVERTISING EXPENSE,
INTEREST EXPENSE,
REPAIRS AND MAINTENANCE EXPENSE.

11 ASSET ACCOUNTS

CASH,
ACCOUNTS RECEIVABLE, INVENTORY or MERCHANDISE INVENTORY,
LAND,
EQUIPMENT,
SUPPLIES,
PREPAID RENT,
PREPAID INSURANCE,
BUILDING,
VEHICLES,
ACCUMULATED DEPRECIATION.

10 LIABILITY ACCOUNTS

ACCOUNTS PAYABLE,
NOTES PAYABLE,
UNEARNED REVENUE,
ACCRUED EXPENSES or ACCRUED LIABILITIES,
INTEREST PAYABLE,
TAXES PAYABLE,
SALARIES PAYABLE,
DIVIDENDS PAYABLE,
MORTGAGE PAYABLE,
LOAN PAYABLE.

4 OWNER'S EQUITY ACCOUNTS

CAPITAL,
OWNER'S EQUITY,
DRAWING / WITHDRAWALS,
RETAINED EARNINGS.