Vocabulary
A list of all the accounts a business has
General Ledger
ADEx is used to summarize the three accounts which increase with DEBIT and decrease with CREDIT
Assets, Dividends and Expenses
A CREDIT is recorded on this account when the owner invests money into the business
Equity
Assets = Liability + Equity
Accounting Equation
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James Harden
Step by step process of recording business activities in order to keep financial records up to date
Accounting Cycle
When a corporation issues stock to its investors in exchange for cash investment, a CREDIT is issued to this account.
Equity
When a business sells a product to a customer, a CREDIT is recorded on this account.
Revenue
Small part of a corporation issued to shareholders in exchange for cash
Dividends
Receipts, Invoices, Paychecks, Purchase order and other records of a business transaction
Original source document
A DEBIT is recorded on this account when new equipment is purchased.
Asset
Accounts Payable, Mortgage, Bank Loans
Liability
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St. Peters University
The operating cycle of a business
Period
Graphic representation of an account with Debits on the left and Credits on the right
T-Chart
Money given to shareholders as a "reward" for their investment
Dividends
Inventory, Equipment, Accounts Receivable, Cash in Bank
Assets
Book-keeping method used to keep track of multiple accounts affected by a business transaction
Record of financial information on the RIGHT side of a T-Chart
Credit
Financial Statement containing the Revenue, Expenses and Profit of a business
Income Statement
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Union Hill