| A | B |
|---|
| Accounting | is the process of planning, recording, analyzing, and interpreting financial information. |
| accounting system | is a planned process designed to compile financial data and summarize the results in accounting records and reports. |
| financial statements. | Financial reports that summarize the financial condition and operations of a business are called |
| net worth statement | allows the person extending the loan to see the financial position of a borrower on a specific date and make a lending decision. |
| asset | Anything of value that is owned |
| liability | An amount owed |
| personal net worth | The difference between personal assets and personal liabilities |
| Equity | the difference between assets and liabilities |
| ethics | The principles of right and wrong that guide an individual in making decisions |
| service business | A business that performs an activity for a fee |
| Sole Proprietorship | a business owned by one person |
| business plan | a formal written document that describes the nature of a business and how it will operate |
| revenue | An increase in equity resulting from the sale of goods or services |
| sale on account | A sale for which payment will be received at a later date |
| expense | Unlike a liability, which is an amount that is owed, the cost of goods or services used to operate a business |
