| A | B |
|---|
| Accounting | The process of keeping and interpreting financial records. |
| Accounting system | The methods and procedures used in consistently handling the business's financial information. |
| Accounts Payable | Accounts Payable are liabilities of a business and represent money owed to others. |
| Accounts Receivable | Assets of a business and represent money owed to a business by others. |
| Accrual accounting method | A method of accounting that records transactions at the time they occur even if no money changes hands at the time |
| Assets | What a company owns |
| Balance Sheet | Provides a snapshot of a business' assets, liabilities, and equity on a given date. |
| Cash accounting method | An accounting method in which income and expenditures are recorded at the time the money changes hands. |
| Cost accounting | Used to reduce and eliminate costs in a business. Cost accounting is used to determine a price for a product or service that will allow earnings of a reasonable profit. |
| Credit | To enter an amount on the right side of an account. Normal entries to revenue accounts are credits. Liabilities normally have credit balances. |
| Debit | A balance on the left side of an account in the general ledger. Typically expenses, losses, and assets have debit balances. |
| Equity | Equity is the value of the owner’s investment in the business. Equity = Assets – Liabilities. |
| Income Statement | A Financial Statement documents the difference in revenue and expenses resulting in income. |
| Liabilities | What a company owes |
| Managerial accounting | A type of accounting that involves preparing and reporting financial data to internal users, usually managers, who need financial information to control day-to-day operations and to make financial decisions and plans affecting the business |
