VOCABULARY FREQUENTLY USED IN ACCOUNTING PROCESS

1. ACCOUNTING TERMS FOR BEGINNERS
• A SIMPLE AND SHORT EXPLANATION OF MOST FREQUENTLY
USED TERMINOLOGY IN ACCOUNTANCY FOR CLASS 11
COMMERCE STUDENTS
•SANGEETA VASHISHTHA

2. BASIC ACCOUNTING TERMS
TERMS HERE STANDS FOR THE VOCABULARY USED IN
ACCOUNTING PRACTICE AND MAKING RECORDS. IT IS
ESSENTIAL TO UNDERSTAND THESE TERMS BEFORE
UNDERSTANDING ACCOUNTING.

3. 1 BUSINESS TRANSACTION
•ECONOMIC ACTIVITY WHICH CHANGES
FINANCIAL CONDITION OF BUSINESS. THIS
CHANGE MUST BE MEASURABLE IN MONETRIC
TERMS . IT CAN BE OF TWO TYPES: INTERNAL
AND EXTERNAL

4. EVENT
• AN EVENT IS OUTCOME OR RESULT OF A
TRANSACTION. Eg
•If goods which were purchased for 10,000 now
sold for 12,000 will result in profit of 2,000. so
its an event.

5. ACCOUNT
•AN ACCOUNT IS A RECORD OF ALL
BUSINESS TRANSACTIONS RELATING TO
PARTICULAR PERSON OR ITEM IN ‘T ‘
SHAPE. ITS LEFT SIDE IS CALLED DEBIT(Dr)
AND RIGHT SIDE IS CALLED CREDIT(Cr.)

6. CAPITAL
•IT REFERS TO THE AMOUNT/ RESOURCES
INVESTED BY PROPRIETOR TO START AND
RUN THE BUSINESS. IT CAN BE IN THE
FORM OF CASH, GOODS, ASSETS ETC.

7. DRAWINGS
•ANY AMOUNT/ GOODS/ ASSETS
WITHDRAWN FROM BUSINESS BY
PROPRIETOR FOR PERSON USAGE IS
CALLED DRAWINGS. DRAWINGS ARE
ALWAYS SUBTRACTED FROM CAPITAL.

8. ASSETS

9. LIABILITIES

10. GOODS/ PURCHASES/ PURCHASES
RETURNS/SALES/ SALES RETURNS

11. STOCK/ TRADE RECEIVABLES/ TRADE
PAYBLES

12. INCOME/ GAIN/PROFIT/LOSS

13. RECEIPTS/ EXPENDITURE/EXPENSES