Balance Sheet and Income Statement Vocabulary

Vocabulary flashcards covering balance sheet and income statement terms from the notes.

Assets

Resources owned by a business from which future economic benefits are expected. Appears on the Balance Sheet.

Liabilities

Obligations of a business arising from past events and settled through the transfer of assets or provision of services. Appears on the Balance Sheet.

Equity

The residual interest in the assets of the entity after deducting liabilities; ownership interest. Appears on the Balance Sheet.

Common Stock

A form of equity representing ownership shares issued by a corporation. Appears on the Balance Sheet (Equity section).

Retained Earnings

Accumulated net income kept in the company after distributions to shareholders. Appears on the Balance Sheet (Equity section).

Dividends

Distributions of earnings to shareholders that reduce retained earnings. Affects Retained Earnings on the Balance Sheet.

Cash

Currency and cash equivalents on hand ready for use. Appears on the Balance Sheet (Asset).

Accounts Receivable

Amounts owed to the company by customers from credit sales. Appears on the Balance Sheet (Asset).

Inventory

Goods held for sale in the ordinary course of business. Appears on the Balance Sheet (Asset).

Supplies

Consumable items used in daily operations. Appears on the Balance Sheet (Asset).

Equipment

Long-term tangible assets used in the operation of the business. Appears on the Balance Sheet (Asset).

Land

Long-term asset representing real estate owned by the company. Appears on the Balance Sheet (Asset).

Accounts Payable

Amounts the company owes to suppliers from purchases on credit. Appears on the Balance Sheet (Liability).

Wages Payable

Accrued wages owed to employees but not yet paid. Appears on the Balance Sheet (Liability).

Notes Payable

Written promises to pay a debt to creditors. Appears on the Balance Sheet (Liability).

Taxes Payable

Taxes owed to the government that have not yet been paid. Appears on the Balance Sheet (Liability).

Unearned Revenue

Cash received before goods or services are provided; a liability. Appears on the Balance Sheet (Liability).

Revenue

Income earned from the core business activities. Appears on the Income Statement.

Sales

Revenue from selling goods. Appears on the Income Statement.

Service Revenue

Revenue earned from providing services. Appears on the Income Statement.

Rental Revenue

Revenue earned from leasing assets. Appears on the Income Statement.

Consulting Revenue

Revenue earned from consulting services. Appears on the Income Statement.

Rent Expense

Cost of renting facilities or equipment for the period. Appears on the Income Statement.

Salaries Expense

Cost of employee compensation for the period. Appears on the Income Statement.

Utilities Expense

Costs of utilities used during the period. Appears on the Income Statement.

Insurance Expense

Cost of insurance coverage for the period. Appears on the Income Statement.

Miscellaneous Expense

Other expenses not classified elsewhere. Appears on the Income Statement.

Balance Sheet

Financial statement showing assets, liabilities, and equity at a date.

Income Statement

Financial statement showing revenues and expenses over a period, resulting in net income.