Fundamentals of Accountancy, Business and Management

A set of flashcards covering key definitions and concepts from the fundamentals of Accountancy, Business, and Management.

Accounting

The systematic process of measuring and reporting relevant financial information about the activities of an economic organization or unit.

Process

A series of actions that produces something or that leads to a particular result.

Recording

The writing down of business transactions chronologically in the books of account as they transpire.

Classifying

The sorting of similar and related business transactions into categories like assets, liabilities, and owner’s equity.

Summarizing

The process of preparing financial statements from the transactions recorded in the books of account.

Luca Pacioli

Considered as the father of accounting.

Sole Proprietorship

A business owned and managed by only one person.

Partnership

A business organization owned and managed by two or more people who agree to contribute to a common fund.

Corporation

A form of business organization managed by an elected board of directors, with investors called stockholders.

Ethics

A set of moral principles or values.

Professional Accountant

An individual who should act in a manner consistent with the good reputation of the profession.

Assets

Things owned by a business.

Liabilities

Things owed by a business.

Transaction

An exchange of value in business.

Accounting Period

A period of time at the end of which financial statements are prepared.

Source Documents

Documents that support an activity to be recorded in the accounting books.

CPA (Certified Public Accountant)

A professional designation for accountants who have passed the CPA examination.

Chart of Accounts

Listing of titles that are to be used for the accounting period.

Revenue

The inflow of assets or decrease in liabilities resulting from the sale of products or services.

Expense

An outflow of assets or an increase in liabilities.

Official Receipt

A document supporting cash received.

Sales Invoice

A proof of sales for the seller and a proof of purchase for the buyer.