Accounting

Unearned Revenue

Income recorded before services or goods have been rendered.

Capital

Initial investments made by owners like stock purchases or partnership buy-ins.

fixed assets

Long-term assets that are relatively permanent such as land, buildings, Equipment, vehicles, machinery, computers or equipment.

supplies

Miscellaneous assets that are entire in product production that are too small and inexpensive to capitalize.

Cash

The most liquid asset a company can own.

Equity

The owner's interest in the company assets.

Journal Entry

is used to record a business event as they occur throughout the year.

Where do Contra equity accounts have balances on the T-account?

left side

account

the record of all the changes in a specific asset, liability, or stockholders' equity during a period

Liability

A creditor's claim on a company' assets.

T account

A formatting system used to setup and maintain accounts balances with debits on the left and credits on the right. This display format also totals the cumulative balances of accounts.

inventory

A list of possessions or goods on hand.

note payable

A long-term contract to borrow money from a creditor

revenue

Assets earned by a company's operations and business activities.

General Journal

A record or collection of all journal entries in an accounting system.

General Ledger

A record or document that contains account summaries for accounts used by a company.

Asset

A resource that is owned or controlled by a company that can be used to provide a future economic benefit.

Financial Accounting

A subsection of the general field of accounting that focuses on gathering and compiling data in order to present it to external users in a usable form.

Notes Receivable

A written promise to repay money.

Accounts Receivable

An asset that arises from selling goods or services to someone on credit

common stock

An equity account that records the amount of money investors initially contributed to the corporation for their ownership in the company.

Accounts Payable

Credit recorded when a company purchase inventory on credit from vendors or supplies.

Extended Accounting Equation

Elongated mathematical formula used as a basis for accounting. Assets = Liabilities + Common Stock - Dividends + Paid In Capital - Treasury Stock + Revenues - Expenses.

Debit

Entry on the right side of an account.

prepaid expenses

Expenditures paid and recorded before actually occurring.

retained earnings

Profits that are kept within the company and distributed to shareholders.

double-entry accounting

The accounting system that requires every business transaction or event to be recorded in at least two accounts.

Summarizes the accounting equation in report format.

The balance sheet

Expenses

The costs incurred to generate revenues.

business event

an exchange of value between two different groups