The description of various terms used in finance and accounting

basic accounting terms for interview

Balances on certain asset, liability and capital accounts may be carried forward or down to the next accounting period. Depreciation: The amount of expense allocated during a specific time period for certain types of assets that lose their value over time - for example, building and equipment.

accounting 101 terms

See also Discount. Income Statement also known as statement of operations, profit and loss statement, or statement of earnings : A financial statement that shows your revenues, expenses, and profit over a specific period of time.

Basic accounting terms in hindi

Assertion Explicit or implicit representations by an entity's management that are embodied in financial statement components and for which the AUDITOR obtains and evaluates evidential matter when forming his or her opinion on the entity's financial statements. Adjusted Trial Balance A trial balance prepared after all adjusting entries have been recorded and posted to the accounts. These can be cash or something you can convert into cash such as property, vehicles, equipment and inventory. Don't feel left out in conversations and don't be left behind because you aren't sure what someone is talking about. Loan to value ratio LVR - your loan amount shown as a percentage of the market value of the property or asset that you purchase. Shareholder equity comes from the start-up capital of the business plus retained earnings amassed over time. Maturity date - when a loan's term ends and all outstanding principal and interest payments are due. It is inserted on the side with the lower total, and is the figure, which, when included, makes the total of both sides the same. Total assets will always equal total liabilities, but there are various ways in which information can be presented. Credit - Entered in the right column of accounts. Other Income - Non-recurring income, e. Net Income can be found on your income statement. Revolving Line of Credit This business finance term and definition is a funding option is similar to a standard line of credit.

The latter is usually done annually, though this may vary when a business is set up, ceases, or changes its accounting period end date. Financial Statement - Financial Statements detail the financial activities of a business.

Floating Interest Rate In contrast to the business finance term and definition fixed rate, the floating interest rate will change with market fluctuations. Payroll - An account listing employees and any wages and salaries due them.

Accounting jargon

Financial Reporting Standard Title of an accounting standard issued by the UK Accounting Standards Board as a definitive statement of best practice issued from onwards — predecessor documents are Statements of Standard Accounting Practice, many of which remain valid. Agency Fund Fund consisting of ASSETS where the holder agrees to remit the assets, income from the assets, or both, to a specified beneficiary in due course or at a specified time. Debt finance - money provided by an external lender, such as a bank or building society. In the UK, a trader manufacturer, dealer, importer, retailer or service provider may register a trademark at the Register of Trade Marks held at the Patent office , which will allow the trader exclusive use of the trademark, initially for seven years. A business line of credit can be especially useful if your business is seasonal or if the income is extremely unpredictable. Liquid Asset - Consist of cash and other assets that can be easily converted to cash. It is the international accounting term now used for trade creditors. It is a process that lets you combine multiple loans into a single loan. Also called a commercial credit score, this number is used by various lenders and suppliers to evaluate your creditworthiness. Fixed asset - a physical asset used in the running of a business. Stock - the actual goods or materials a business currently has on hand. Contrast with repair which restores the existing useful life or existing expected future benefit. Line of Credit A lender may offer you an unsecured amount of funds available for your business to draw on when capital is needed. Typical trade credit periods range from 30 to 60 days but each agreement is different.

Information about marketable securities can be found on your Balance Sheet.

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60 Business Finance Terms and Definitions You Absolutely Should Know