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Management 111 Accounting
Accounting terms
24
Management
Undergraduate 1
11/04/2012

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Term
Accounting
Definition
It is the systematic way by which we show where the money is.
Term
bookkeeper
Definition
-begins accounting cycle
-records financial transactions
-prepares the books
Term
Accountant
Definition
-analyzes information
-applies appropriate accounting rules
-makes recommendations to decision-makers
Term
The accounting cycle
Definition
1. Analyze source documents
2. record transactions in journals
3. transfer
4. take a trial balance
5. prepare financial statements
6. analyze financial statements
Term
Owners Equity
Definition
The amount of business that belongs to the owners minus any liabilities owed by the business
Term
Accounts receivable
Definition
A current asset that represents what customers owe you for merchandise
Term
Revenue
Definition
the value of what a firm receives for goods and services (sales)
Term
Assets
Definition
The things of value owned by a firm
Term
Balance Sheet
Definition
A financial statement that shows a firms financial conditions for a specific time
Term
bookkeeping
Definition
the recording of financial transactions
Term
cash flow
Definition
the difference between cash coming in and cash going out
Term
cost of goods sold
Definition
the measure of the cost of merchandise sold or the cost of raw materials and supplies used for producing a product.
Term
Current assets
Definition
items that can or will be converted into cash within one year
Term
depreciation
Definition
a systematic write off of the cost of a tangible asset over time
Term
Double entry bookkeeping
Definition
A method of recording every financial transaction twice in a firm's account ledger. Once on the asset side, another on the liability side to keep the ledger balanced.
Term
Fixed assets
Definition
long term assets that are fairly permanent
Term
Fundamental accounting equation
Definition
assets=liability + owners equity
Term
Income statement
Definition
the financial statement that shows a firms bottom line (profit after costs)
Term
journal
Definition
a record book or computer program in which daily financial transactions are kept
Term
ledger
Definition
a specialized accounting book in which info from accounting journals is transferred into special categories (office supplies, cash).
Term
liabilities
Definition
what a business owes to others
Term
liquidity
Definition
a term for how fast an asset can be converted into cash
Term
notes payable
Definition
short or long term liabilities that a company will pay by a certain date
Term
retained earnings
Definition
the accumulated earnings from the firms profitable operations that were kept and not paid out to stockholders
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