Please study the 14 vocabulary terms below. Then press the Mark Complete button to continue.
- accounting equation
- capital
- contingent liabilities
- current assets
- draws
- goodwill
- income statement
- incur
- intangible asset
- intellectual property
- quantify
- shareholder equity
- sole proprietorship
- terminology
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The foundation of double entry accounting which shows that all assets are either financed by borrowing money or paying with the money of the company's shareholders.
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The accounting equation was the first thing I learned on the bookkeeping course I went on.
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The total financial value of all assets, less any liabilities.
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After three years trading the capital of the company had increased to $100m.
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A potential obligation that may be incurred depending on the outcome of a future event.
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The management accountant estimated a contingent liability of $45,000 on the purchase of the new property.
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All assets that are expected to be converted into cash within one year of normal business activity.
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Of course you cannot depreciate current assets as they won't be in the company a year from now.
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The withdrawal of business cash or other assets by the owner for the personal use of the owner.
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The accounting team tried to explain that the owner shouldn't make so many draws from the company as it was leading to huge losses.
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The favour or advantage that a business has acquired especially through its brands and its good reputation.
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The company had assets of $62 million excluding goodwill.
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The financial statement which measures a company's financial performance over a specific accounting period.
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After studying the income statement it was clear that the company was in financial trouble.
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Come into or acquire (some consequence, usually undesirable).
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The company has incurred taxes of $27,000 this quarter.
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An asset which is not physical in nature, such as branding or a patent.
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The valuation team had trouble valuing the intangible assets of the firm.
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Creations of the mind: inventions, literary and artistic works, and symbols, names, images, and designs used in commerce.
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Lawyers and accountants in Hollywood have to be experienced in intellectual property law.
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Determine or express the quantity of.
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When entering a new market, you should be able to quantify the potential sales and the risk attached to them.
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A firm's total assets minus its total liabilities.
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The board of management was delighted with the 15% rise in shareholder equity on the past year.
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A type of business entity that is owned and run by one individual.
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Many people choose to form a sole proprietorship as it is the simplest form of business entity.
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A specific vocabulary of technical terms, used in a particular field.
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There is some very complicated terminology in accounting so you should make sure you have a good dictionary.