accounting principles The standards, rules, guidelines, and industry- specific requirements for financial reporting.
generally accepted accountingprinciples (GAAP) The general guidelines and principles, standards and detailed rules, plus industry practices that exist for financial reporting. Often referred to by its acronym GAAP
Entity An economic unit that performs economic activities (Eg. Reliance Industries, Raymonds) EventHappening to an entity (Eg Recruitment of employees) TransactionIs an exchange in which each participant receives or sacrifices value
Assets Any thing of use in future operations & belonging to organization. RevenueMonetary value of goods & services sold Expenses/CostExpenses incurred to earn revenue
Loss It can be explained in two different meanings When expenses > Revenue & Those affords that fails to earn revenue
Owner Person who invest his money & bears the risk of the business DrawingsMoney or value of goods belonging to business used by owner for his personal use
Goods All commodities which are purchased for selling in the usual course of business Sundry DebtorsFrom whom amounts are due for goods sold or services rendered Sundry CreditorsAmount owed by the enterprise on account of goods purchased or services rendered
accounts receivable A current asset resulting from selling goods or services on credit (on account). Accounts PayableA current liability resulting from purchase of goods or services on credit
bad debts expense This is an operating expense resulting from making sales on credit and not collecting the customers entire accounts receivable balances
balance sheet One of the main financial statements. The balance sheet reports the assets, liabilities. Also referred to as the Statement of Financial Position.
wages The compensation earned by employees who are paid on an hourly basis. It is common for production workers to earn wages, since they are usually paid via an hourly rate
salary The compensation usually associated with executives, managers, professionals, office employees, etc. whose pay is stated on an annual or on a monthly basis. (On the other hand, "wages" is usually associated with employees whose pay is stated on an hourly basis.)