Term
What is a Liability
Something you owe
What is Capital
Used to summarize the Owners Equity in the business
What's a Rent Expense
When you pay Cash for Rent
What is a Debit
Everything on the right side of a T-Account
What is an Asset
Something you own
What must always happen to the accounting Equation
Must always Balance
What is accounts Payable
When you buy something on an account
What is a Credit
Everything on the left side of the T-Account
What is Owner's Equity
An amount that the business actually owned by the amount owed
What is the accounting system called
Dual entry system or Double entry system
What is a Revenue
When someone buys something on an account from the business
The Debit side for an Asset
Which side is the Normal Balance
What is Drawing
Account used when the owner withdraws cash or merchandise for personal use
What's the accounting Equation
Asset=Liabilities+Owners Equity
What is an Asset
When the business buys supplies
The accounts on the normal side of the credit side
Liability,Revenue,and Owners Equity capial accounts
What is an Expense
The price paid for goods and survices used to operate a business
What's the extended accounting Equation
Assets=Liabilities+Owners Equity+Revenue-Expense
What is Prepaid Insurance
Premiums for insurance that are paid in advance
When cash is received
The cash amount is Debit