record of financial transactions for an asset or individual, such as at a bank, brokerage, credit card company, or retail store.
More generally, an arrangement between a buyer and a seller in which payments are to be made in the future.
Person skilled in the recording and reporting of financial transactions. (See CERTIFIED PUBLIC ACCOUNTANT.)
The accounting equation is assets=liabilities+capital. This equation is the basis of a balance sheet and double-entry accounting.
Virtually all universities and colleges offer accounting classes. These accounting courses cover topics related to providing financial management services for large corporations, and don?t spend much time, if any, in small business concerns. Today, many universities offer online accounting courses to cater to the busy schedules of individuals. Learning accounting online provides similar training in a more casual, self-paced environment. Universal Accounting Center has accounting courses that provide a distance learning opportunity in a short time-frame.
Training in setting up a financial tracking system, monitoring the data-entry process for financial transactions, and the interpretation of financial statements for management. Accounting training must include instruction in General Ledger and financial statement format. Accounting courses are available from Universal Accounting Center on a distance learning basis, or through attending accounting classes at one of Universal?s accounting schools. Common misspellings and abbreviations of Accounting and Accountant are: acounting, accouting, accountin, accoutant, acct, actng, acctnt
A current liability representing the amount owed by a business to a creditor for the merchandise or services purchased on open account (i.e., without the giving of a note or other evidence of debt). It is also called ?A/P? or just ?Payables?. Accounts Payable are the current bills a business owes to suppliers.
Money owed a business enterprise for merchandise bought on open account. It is also called "A/R" or just "Receivables". Accounts Receivable are the amounts owed to a company by its customers and/or employees.
The practice of record keeping by which income is recorded when earned and expenses are recorded when incurred, even though the cash may not be received or paid out until later.
Accrual Basis Of Accounting:
Accrual basis of accounting is based upon generally accepted accounting principles. It recognizes income when it is earned and not when it the cash received and recognizes expenses when they are owed and not when you pay them. Accrual basis of accounting includes Accounts Receivable, Accounts Payable, and Inventory. The practice of record keeping by which income is recorded when earned and expenses are recorded when incurred, even though the cash may not be received or paid out until later.
These are expenses incurred during an accounting period for which payment has not been made.
Income earned during a fiscal period but not actually received during that fiscal period.
These are liabilities which have occurred, but have not been paid during an accounting period. Examples would include accrued wages payable, accrued sales tax payable, and accrued rent payable.
Accrued Liability Expenses:
Expenses incurred during a fiscal period but not paid by the end of that fiscal period.
Total DEPRECIATION pertaining to an ASSET or group of assets from the time the assets were placed in services until the date of the FINANCIAL STATEMENT or tax return. This total is the CONTRA ACCOUNT to the related asset account.
Additional Paid in Capital
Amounts paid for stock in excess of its PAR VALUE or STATED VALUE. Also, other amounts paid by stockholders and charged to EQUITY ACCOUNTS other than CAPITAL STOCK.
After a taxpayer's basis in property is determined, it must be adjusted upward to include any additions of capital to the property and reduced by any returns of capital to the taxpayer. Additions might include improvements to the property and subtractions may include depreciation or depletion. A taxpayer's adjusted basis in property is deducted from the amount realized to find the gain or loss on sale or disposition.
Adjusted Gross Income
Gross income reduced by business and other specified expenses of individual taxpayers. The amount of adjusted gross income affects the extent to which medical expenses, non business casualty and theft losses and charitable contributions may be deductible. It is also an important figure in the basis of many other individual planning issues as well as a key line item on the IRS form 1040 and required state forms
Adjusted Sales Price:
Selling price minus expenses of sale, minus fix-up expenses.
Adjusting entries are special entries that are made prior to closing the books for the accounting period. An example of an adjusting entry would be adjusting payroll taxes to actual based upon supporting documentation.
Aging Accounts Receivable:
Grouping customer accounts according to due dates.
An aging report is a list of customers' accounts receivable amounts by age. The report is usually divided into columns of 30-day increments such as 0-30, 31-60, 61-90, 91-120, and 120+. It alerts management to any slow paying customers.
Allowance For Bad Debts:
It is also called Allowance for Doubtful Accounts. It is an estimate of uncollectible customer accounts. It is called a "contra" account because it is listed with the current assets on the balance sheet although it is a credit balance account. The account balance is determined through use of the Historical Method or Over 90 Days Past Due Method.
Allowance (Reserve) For Depreciation:
The allowance for depreciation is the accumulation of amounts charged to expense to write off the cost of a fixed asset over its estimated useful life. The allowance account does not necessarily measure the decline in value of the related asset nor does it represent a specific fund of cash or other assets set aside to replace the related asset.
American Institute of Certified Public Accountants (AICPA):
The letters AICPA are the acronym for the American Institute of Certified Public Accountants. Most certified public accountants in private practice are members of the AICPA.
The gradual reduction of a debt by means of equal periodic payments sufficient to meet current interest and liquidate the debt at maturity. When the debt involves real property, often the periodic payments include a sum sufficient to pay taxes and hazard insurance on the property.
Amortization expense is that portion of an intangible asset that is being written off for the year. For example, if goodwill has a fifteen-year life with a value of $60,000, the amortization expense on the straight-line method would be $4,000 ($60,000 divided by 15 years.)
The selling price minus the selling expenses.
Series of payments, usually payable at specified time intervals
Anything owned by an individual or a business, which has commercial or exchange value. Assets may consist of specific property or claims against others, in contrast to obligations due others. Assets are things of value held (usually owned) by the business. Assets are balance sheet accounts. Examples are cash, accounts receivable, inventory, and fixed assets.
Average Daily Balance:
The average amount of money that a customer keeps on deposit. It is determined by adding the daily balances of an account for a given length of time, and dividing the total by the number of days covered.
The approximate amount of merchandise on hand during a certain period.