Question

Define any six basie terminologies in accounting?​

Answer 1

Basic Teminologies in Accounting are as follows:

1. Accounts Payable – Outstanding payments the company currently owes to suppliers, vendors, and creditors — essentially any bills the company still has yet to pay.

2. Accounts Receivable – Outstanding payments the company is currently owed by all customers or clients. Basically, this is anything the company bills out.

3. Balance Sheet – A financial document that reconciles all the company's assets with their liabilities and equity.

4. Costs of Goods Sold – The total money spent to produce goods and services, including production, labor, storage and material costs.

5. Current Assets – Capital that has immediate value (typically that which will be used within one year), including cash, sellable products or accounts receivable.

7. Equity – All capital currently invested in the company, including any profits that have been re-invested as retained earnings.

8. Expenses – Any additional money spent operating the company that's not associated with the production of sellable products and services. Examples of expenses include office supplies, lease for the place of business and employee wages.

9. Fixed Assets – Assets with long-term value, such as land and property, tools and machinery, or vehicles.

10. General Ledger – Record of all financial transactions across all of a company's accounts, which is maintained continuously for the entire life of the company.

11. Income Statement – All outstanding debts owed by the company. This could include accounts payable, loans, liens on property or other long-term investments.

12. Liabilities – Outstanding payments the company is currently owed by all customers or clients. Basically, this is anything the company bills out.

13. Net Income – The company's total profit (or loss, if negative) once costs and expenses are subtracted from revenue.

14. Revenue – All incoming money from selling products and services or generated through a company's additional assets, before expenses are taken into account. Also referred to as "gross income."

Answer 2

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$\bigstar \: \: \: \large{ \bold{ \underline{ \pink{ \: \: Some \: \: basic \: \: terminologies \: \: in \: \: Accounting \: \: }}}} \\ \: \: \: \: \: \: \: \large{ \bold{ \underline{ \pink{ \: \: are \: \: as \: \: follows :- \: \: }}}}$

$\sf{ \underline{ \underline{ \blue{ \: 1) \: Asset : \: }}}} \: \: \texttt{ An asset is the wealth that has been } \\ \texttt{accumulated by the business or company and is } \\ \texttt{owned outright without loan or lien. The assets } \\ \texttt{are generally grouped as : (i) Fixed Assets, } \\ \texttt{(ii) Current Assets and (iii) Fictitious Assets. } \\ \\ \underline{ \bold{ \: </p><p> Example \: \: of \: \: Assets : \: }} \: \: Land \: \: and \: \: building, \: plant \: \: and \\ machinery, \: cash \: \: in \: \: hand, \: cash \: \: at \: \: bank, \: goodwill \: \: etc.$

$\sf{ \underline{ \underline{ \blue{ \: 2) \: Liability : \: }}}} \: \: \texttt{Liability is the obligations that a business } \\ \texttt{or company needs to fulfill. It results in the company's} \\ \texttt{/business's future sacrifices of economic benefits to } \\ \texttt{other entities or businesses. The liabilities are } \\ \texttt{generally grouped as : (i) Internal Liabilities and } \\ \texttt{(ii) External Liabilities.} \\ \\ \underline{ \bold{ \: Example \: \: of \: \: Liabilities : \: }} \: \: Bank \: \: overdraft, \: bills \: \: payable, \: \\ bank \: \: loan, \: outstanding \: \: expenses \: \: etc.$

$\sf{ \underline{ \underline{ \blue{ \:3) \: Entity : \: }}}} \: \: \texttt{An entity is an organizational structure } \\ \texttt{which has its own processes, goals and records. It } \\ \texttt{maintains a separate and distinct existence.} \\ \\ \underline{ \bold{ \: Example \: \: of \: \: Entities: \: }} \: \: \: Sole \: \: proprietorship \: \: entity, \\ partnership \: \: entity \: \: etc.$

$\sf{ \underline{ \underline{ \blue{ \: 4) \: Accounting \: \: Transaction : \: }}}} \: \: \texttt{An accounting transaction is a } \\ \texttt{business event that has a monetary impact on the financial } \\ \texttt{statements of a business or company. It must be measurable } \\ \texttt{in terms of money. } \\ \\ \underline{ \bold{ \: Example \: \: of \: \: Transactions : \: }} \: \: Goods \: \: sold \: \: on \: \: cash, \: Purchase \: \: \\ goods \: \: etc.$

$\sf{ \underline{ \underline{ \blue{ \:5) \: Capital : \: }}}} \: \: \texttt{Capital is the goods, cash or assets which has } \\ \texttt{been initially invested by the proprietor while commencing } \\ \texttt{the business. It is the financial resources that a business } \\ \texttt{can use to fund their operations.}$

$\sf{ \underline{ \underline{ \blue{ \: 6) \: Drawings : \: }}}} \: \: \texttt{Drawings are the amount of cash or goods }\\ \texttt{that is withdrawn from the business by the proprietor } \\ \texttt{for personal/domestic use. These are the resources } \\ \texttt{which are taken by the owner of the business concern } \\ \texttt{for his personal uses.}$