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| Accounting | An information system that measures, processes, and communicates financial information about an identifiable economic entiry. |
| Accounting Equation | Assets = Liabilities + Owners' Equity, or for corporations Assets = Liabilities + Stockholders' Equity. |
| Accounts | The label used by accountants to accumulate the amounts produced from similar transactions. |
| AICPA | American Institute of Certified Public Accountants. The professional association of certified public accountants. |
| Articles of Incorporation | An official document filed with and approved by a state that authorizes the incorporators to do business as a corporation. |
| Assets | Economic resources owned by a business that are expected to benefit future operations. |
| Audits | An examination of a company's financial statements in order to render an independent professional opinion that they have been presented fairly, in all material respects, in conformity with generally accepted accounting principles. |
| Balance Sheet | The financial statement that shows the assets, liabilities, and stockholders' equity of a business at a point in time. |
| Bookeeping | The process of recording financial transactions and keeping financial records. |
| Business | An economic unit that aims to sell goods and/or services to customers at prices that will provide an adequate return to its owners. |
| Business Transactions | Economic events that affect the financial position of a business entiry. |
| Cash Flows | The inflows and outflows of cash into and out of a business. |
| CPA | Certified Public Accountant. Public accountants who have met the stringeht licensing requirements set by the individual states. |
| Contributed Capital | The part of stockholders' equity that represents the amount invested in the business by the owners (stockholders). |
| Corporation | A business unit granted a state charter recognizing it as a separate legal entity having its own rights, privileges, and liabilities distinct from those of its owners. |
| Dividends | Distributions to stockholders of assets (usually cash) generated by past earnings. |
| Exchange rate | The value of one currency in terms of another. |
| Expenses | Decreases ins tockholders' equity that result from operating a business. |
| Financial Accounting | The process of generating and communicating accounting information in the form of financial statements to those outside the organization. |
| FASB | Financial Accounting Standards Board. The most important body for developing and issuing rules on accounting practice called Statements of Financial Accounting Standards. |
| Financial Position | The economic resources that belong to a company and the claims (equities) against those resources at a point in time. |
| Financial Statements | The primary means of communicating important accounting information to users. They include the Income Statement, Statement of Retained Earnings, Balance Sheet and Statement of Cash Flows. |
| Financing Activities | Activities undertaken by management to obtain adequate funds to begin and to continue operating a business. |
| GAAP | Generally Accepted Accounting Principles. The conventions, rules, and procedures that define accepted accounting practice at a particular time. |
| Income Statement | The financial statement that summarizes the revenues earned and expenses incurred by a business over a period of time. |
