ACCOUNTING TERMINOLOGIES

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ALL ABOUT ACCOUNTING :- 27th BLOG

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Hi freinds., 🙏

Today's discuss accounting terminologies..... 

                                            So let's discuss .....

  ★ ACCOUNTING TERMINOLOGIES :- 
Accounting terminology gives the complete description of the terms that are used and it is important to know the accounting terminology before delving into the subject.

Total 42 accounting terminologies all business man should know. 

So let's discuss one by one... 

  ★BALANCE SHEET TERMS :
The Balance Sheet is one of the two most common financial statements produced by accountants. This section pertains to potentially confusing terms that relate to the balance sheet.

1. BALANCE SHEET (B/S) :
A financial statement that reports on all of a company’s assets, liabilities, and equity. As suggested by its name, a balance sheet abides by the equation <Assets = Liabilities + Equity>.

2. ACCOUNTS PAYABLE (A/P) :
Accounts Payable include all of the expenses that a business has incurred but has not yet paid. This account is recorded as a liability on the Balance Sheet as it is a debt owed by the company.

3. ACCOUNTS RECEIVABLE (A/R) :
Accounts Receivable include all of the revenue (sales) that a company has provided but has not yet collected payment on. This account is on the Balance Sheet, recorded as an asset that will likely convert to cash in the short-term. 

4. ACCRUED EXPENSE :
An expense that been incurred but hasn't been paid is described by the term Accrued Expense.

5. ASSET :
Anything the company owns that has monetary value. These are listed in order of liquidity, from cash (the most liquid) to land (least liquid).

6. BOOK VALUE (B/A) 
As an asset is depreciated, it loses value. The Book Value shows the original value of an Asset, less any accumulated Depreciation.

7. EQUITY (E) : 
Equity denotes the value left over after liabilities have been removed. Recall the equation Assets = Liabilities + Equity. If you take your Assets and subtract your Liabilities, you are left with Equity, which is the portion of the company that is owned by the investors and owners.

8. INVENTORY :
Inventory is the term used to classify the assets that a company has purchased to sell to its customers that remain unsold. As these items are sold to customers, the inventory account will lower.

9. LIABILITY :
All debts that a company has yet to pay are referred to as Liabilities. Common liabilities include Accounts Payable, Payroll, and Loans.





Remaining 33 terms discuss in 28th blog... 

                                  So wait my 28th blog..... 
 
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