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  • Accounting Terms

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    AmIt Sharma
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    The document defines 12 key accounting terms: 1) Capital is the amount invested by the proprietor in the firm. Assets are things of value owned by the firm. Liability is the amount owed by the firm to outsiders. 2) Revenue is the amount added to capital from operations like sales. Expense is the amount spent to produce and sell goods and services. 3) Other terms include purchases, sales, stock, debtors, creditors, proprietor, drawings, and transactions.

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    accounts information

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    The document defines 12 key accounting terms: 1) Capital is the amount invested by the proprietor in the firm. Assets are things of value owned by the firm. Liability is the amount owed by the firm to outsiders. 2) Revenue is the amount added to capital from operations like sales. Expense is the amount spent to produce and sell goods and services. 3) Other terms include purchases, sales, stock, debtors, creditors, proprietor, drawings, and transactions.

    Copyright:

    Attribution Non-Commercial (BY-NC)
    Download as DOCX, PDF, TXT or read online from Scribd
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    8 views2 pages

    Accounting Terms

    Uploaded by

    AmIt Sharma
    The document defines 12 key accounting terms: 1) Capital is the amount invested by the proprietor in the firm. Assets are things of value owned by the firm. Liability is the amount owed by the firm to outsiders. 2) Revenue is the amount added to capital from operations like sales. Expense is the amount spent to produce and sell goods and services. 3) Other terms include purchases, sales, stock, debtors, creditors, proprietor, drawings, and transactions.

    Copyright:

    Attribution Non-Commercial (BY-NC)
    Download as DOCX, PDF, TXT or read online from Scribd
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    MAIN ACCOUNTING TERMS

    Before going ahead you must have knowledge of accounting terminology, which is, used daily in business world. 1. Capital - It is the amount invested by the proprietor in the firm. For the business it is liability towards the owner. Capital = Assets Liabilities. 2. Asset Assets are things of value owned. In other words anything, asset. Money owing by debtors, stock, cash, furniture, machinery, buildings etc. are a few examples of assets.

    which will enable the firm to get cash or a benefit in future, is called

    3. Liability It is the amount, which the firm owes to outsiders Liability = Assets Capital

    4. Revenue It is the amount, which is added to the capital as a result of operation. Receipts from sale of goods, rental income etc. are a few examples of revenue.

    5. Expense It is the amount spent in order to produce and sell the goods and services which produce the revenue. Some examples of expenses are salaries, wages, rent, etc. Income = Revenue Expense. 5. Purchase Cash and Credit purchases of goods. 6. Sale Cash and Credit sales of goods. 7. Stock Stock includes goods lying unsold on a particular date. 8. Debtors A person who owes money to the firm. 9. Creditor A person to whom the money owes by the firm. 10. Proprietor The person who makes the investment and bears all the

    risks connected with the business is called the proprietor. 11. Drawings It is the amount of the money or the value of goods which the proprietor takes for his domestic or personal use.

    12. Transaction exchange of goods or services for cash e.g. purchase of a machinery etc.

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