Studied by 0 people
Looks like no one added any tags here yet for you.
Accrual Accounting
Accounting method that recognizes revenues and expenses when they are earned or incurred, regardless of when cash is exchanged.
Cash Basis Accounting
Accounting method that records revenues and expenses only when cash is received or paid.
Revenue Recognition Principle
The principle that revenues are recognized when goods or services are provided and payment is ensured.
GAAP
Generally Accepted Accounting Principles; a framework of accounting standards, principles, and procedures.
Matching Principle
An accounting principle that mandates that expenses be matched with revenues in the period they are incurred.
Accounting Conservatism
An accounting principle that advises caution and verification in financial reporting, recognizing potential losses but deferring gains.
Expense Recognition
The process of matching expenses with the revenues they help to generate.
Retained Earnings
The cumulative amount of net income retained in the corporation rather than paid out as dividends.
Financial Statements
Formal records of the financial activities of a business, including balance sheets and income statements.
Net Income
The total profit of a company calculated as revenues minus expenses.
Accrued Revenue
Revenue that has been earned but not yet received in cash.
Deferred Revenue
Cash received before goods or services have been delivered, recognized as a liability.
Accounts Payable
Liabilities owed by a company to creditors for goods or services purchased on credit.
Accounts Receivable
Assets representing money owed to a company by its customers for goods or services delivered.
Trial Balance
A report that lists the balances of all accounts in the general ledger to ensure that debits equal credits.
Journal Entries
Records of transactions entered into an accounting system.
Assets
Resources owned by a business that have economic value.
Liabilities
Obligations of a company to pay debts to creditors.
Cash Flow
The net amount of cash being transferred into and out of a business.
CapEx
Capital Expenditure; funds used by a company to acquire or upgrade physical assets.
Revenue
The income generated from normal business operations.
Expenses
Costs incurred in the process of earning revenue.
Standard Costing
The practice of comparing actual costs to standard costs to manage costs effectively.
Financial Accounting
The field of accounting that focuses on the reporting of an organization's financial information.
Internal Controls
Processes and procedures to ensure the integrity of financial and accounting information.
Fiscal Year
A one-year period that companies use for financial reporting and budgeting.
Audit Trail
A method of tracking financial transactions and changes to financial records.
Inventory
The goods and materials a business holds for the purpose of resale.
Legal Fees Expense
Costs incurred for legal services, recorded when the services are utilized or completed.
Delivery of Goods
The transfer of goods from the seller to the buyer as part of a transaction.
Prepayments
Payments made in advance for goods or services to be delivered or performed in the future.
Renovation Expense
Costs associated with improving or restoring a building or facility.
Employee Salaries
Compensation promised to employees for their work, to be recognized when the work is performed.
Accounting Cycle
The collective process of identifying, analyzing, and recording the financial transactions of a business.
