Category: Accounting Terms

PricewaterhouseCoopers (PwC) is a multinational professional services network headquartered in London, United Kingdom. It is the second largest professi…

Social accounting is the process of accounting for the social and environmental impacts of an organization’s activities. It goes beyond traditional fina…

A security is a tradable asset of any kind. In accounting, security refers to any form of financial instrument that can be traded. A security is a contr…

Sales journal is a book of original entries in which transactions relating to sales are recorded. It is also known as the “book of sales.” Sales journal…

Revenue recognition is the accounting process of recognizing revenue earned. This involves recording sales or other transactions as revenue on the compa…

Production accounting is a branch of accounting that deals with the financial aspects of film and television production. It includes tracking income and…

Profit and loss account is a financial statement that shows the revenue, expenses, and profit or loss of a company over a certain period of time. This s…

Project accounting is a system that allows businesses to track the financial progress of specific projects. This type of accounting can give businesses …

Positive assurance is a type of accounting that helps to ensure the accuracy of financial statements. This is done by providing third-party verification…

Payroll refers to the process of calculating and distributing employee wages. This process can be completed manually or through payroll software. Payrol…

Positive accounting is the branch of accounting that attempts to explain and predict accounting phenomena from a positive perspective, rather than from …

The pro-forma amount is the estimated or projected value of something. In accounting, pro-forma amounts are often used to estimate future income or expe…

The P/E ratio, or price-to-earnings ratio, is a financial metric used to assess the relative value of a company’s stock. The ratio is calculated by divi…

Petty cash is a small amount of money that businesses keep on hand for minor, everyday expenses. The petty cash fund is usually kept in a lockbox or dra…

The Outline of Business is a tool used in accounting that provides a high-level overview of a company’s financial activities. It can be used to help ass…

Operating expenses are the costs associated with running a business on a day-to-day basis. This can include everything from rent and utilities to salari…

Online accounting is the process of recording, storing, and retrieving financial transactions via the internet. It allows businesses to manage their fin…

Oberac is an accounting term that refers to the owner’s equity in a business. This can be calculated by subtracting the liabilities from the assets. Obe…

The notes to the financial statements is a section of a company’s financial statements that provides additional information about the accounting behind …

Net income is a company’s total earnings or profit. This figure is calculated by subtracting all expenses from revenue. Net income can be positive or ne…

Management assertions are accounting statements that management makes about their organization’s finances. This can include assertions about assets, lia…

Negative assurance is a type of accounting assurance that focuses on what could go wrong, rather than on what could go right. Negative assurance is typi…

One-for-one checking is a type of accounting in which each transaction is checked against another transaction to ensure accuracy. This method can be use…

Money Measurement Concept is the accounting concept that only transactions that can be expressed in terms of money can be recorded in financial statemen…

Materiality refers to the magnitude of an accounting error that, in the view of management, could influence the economic decisions of users taken on the…

The accounting principle requires expenses to be matched with revenues in the period in which the revenue is earned. The matching principle is used in a…

Mark-to-market accounting is a method of accounting whereby the value of an asset or liability is recorded on the balance sheet at its current market va…

The Maker-Checker accounting system is a system in which two people are responsible for each transaction. The “maker” is responsible for creating the tr…

A journal is a record of the financial transactions of a business or individual. Transactions are recorded in chronological order, and each entry is typ…

An accounting long-term asset is an account that represents the company’s investment in property, plant, and equipment (PP&E) that will be used for prod…

Inventory refers to the goods and materials that a business has on hand. Inventory is considered to be a current asset on the balance sheet, and it is o…

Job costing is an accounting system that tracks the costs associated with a specific job or project. This information can be used to determine the profi…

The accounting term “loss on sale of residential property” refers to the amount of money that a company loses when it sells a piece of property for less…

Liability is defined as a person or thing against which a claim or debt is held. In accounting, liabilities are money owed by an individual, company or …

An invoice is a document that records the sale of goods or services. It typically includes the quantity and price of the items sold, as well as the date…