The language of accounting | Quizlet

(to) incur (e.g. charges, debts)

experience sth bad because of your actions (e.g. charges, debts)

(e.g. internal, security) audit

official examination of accounts

depreciation (e.g. of assets, property)

decrease in value

ledger

book with a company's financial transactions

to enter sth into a ledger

officially record financial information

to balance a ledger

ensure accounting records match (debits = credits)

assets

things of value that a company owns

capital assets (/fixed assets)

long-term assets

current assets

assets (cash, raw materials, parts) which a company will use up or sell in the same year

frozen assets

an asset that cannot be sold because of a government or court order

liquid assets

assets which can be readily used

tangible assets

physical assets

intangible assets

non-physical assets

(e.g. performance/ financial) benchmark

a standard for other things to be compared with

compliance with (e.g. standards, regulations)

obeying rules

comply with

obey rules

reconcile (e.g. numbers, transactions with bank statements)

compare different accounts to check if they have the same total

exemption (e.g. tax exemption)

permission not to pay/do something

deduction (e.g. tax deduction)

amount subtracted from a total (from pay, taxes)

taxable

subject to tax

accounts receivable

money owed to the company by customers

accounts payable

money the company owes e.g. to suppliers

liquidity

money or assets that can be converted into money

liability

amount owed; also: sth that causes you a lot of trouble

accrual

increase in money or debt over time

fiscal (eg. year, policy)

relating to taxes and public money

exempt somebody from something

to allow someone not to do something

deduct

to take away; subtract

to tax something

to impose a tax on something

liquidate

to sell investments/ property to have money

accrue

to accumulate over time

issue shares

increase the number of shares in circulation

liquidate shares

sell existing shares

evade

to avoid sth in an illegal way

tax evasion (to EVADE taxes)

the use of illegal actions to reduce your taxes

tax avoidance (to AVOID taxes)

the legal use of tax laws and provisions to reduce your tax

financial statement

a summary of all the financial transactions in a certain period

profit and loss account

a statement which summarises business activity over a period of time (sales and costs)

revenue

total amount of money generated by a company's core business operations

cost of goods sold

(direct costs) includes manufacturing costs, salaries of manual (= blue-collar) workers, etc.

operating expenses (OpEx)

(= indirect costs/ overhead) include salaries of sales and office saff, marketing costs, utility bills, etc.

non-operating income

includes profits from investments in other companies

balance sheet

A financial statement that reports assets, liabilities, and owner's equity on a specific date.