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Accounting Principle
Accounting Terms/Vocabulary
Term | Definition |
---|---|
Accounting Cycle | the series of accounting activities included in recording financial information for a fiscal period. |
Accounts Payable Ledger | a subsidiary ledger containing only accounts for vendors from whom items are purchased or bought on account. |
Accounts Receivable Ledger | a subsidiary ledger containing only accounts for charge customers. |
Accumulated depreciation | the total amount of depreciation expense that has been recorded since the purchase of a plan asset. |
Adjusting entries | journal entries recorded to update general ledger accounts at the end of a fiscal period. |
Asset | anything of value that is owned. |
Bank statement | a report of deposits withdrawals, and bank balances sent to a depositor by a bank. |
Capital | The account used to summarize the owner's equity in a business. |
Capital Stock | Total shares of ownership in a corporation. |
Closing Entries | Journal entries used to prepare temporary accounts for a new fiscal period. |
Code of Conduct | A statement that guides the ethical behavior of a company and its employees. |
Corporation | An organization with the legal rights of a person and which may be owned by many persons. |
Credit | An amount recorded on the right side of a T-account. |
Current Assets | Cash and other assets expected to be exchanged for cash or consumed within a year. |
Debit | An amount recorded on the left side of a T-account. |
Dividends | Earnings distributed to stockholders. |
Entry | Information for each transaction recorded in a journal. |
Expense | A decrease in owner's equity resulting from the operation of a business. |
General Journal | A journal with two amount columns in which all kinds of entries can be recorded. |
General Ledger | A ledger that contains all accounts needed to prepare financial statements. |
Liability | An amount owed by a business. |
Long-Term Liabilities | Liabilities owed for more than a year. |
Owner's Equity | The amount remaining after the value of all liabilities is subtracted from the value of all assets. |
Revenue | An increase in owner's equity resulting from the operation of a business. |
Stockholder | An owner of one or more shares of a corporation. |
T-account | An accounting device used to analyze transactions. |