Basic accounting terms for interview
After you feel like you really understand the word, try to think of your own example sentences. In addition to recording financial transactions, it involves reporting, analyzing and summarizing information. Small businesses using cash accounting system benefit from the ease of this system, which is much like keeping a checkbook. Adjusted Basis After a taxpayer's basis in property is determined, it must be adjusted upward to include any additions of capital to the property and reduced by any returns of capital to the taxpayer. Cross-reference bank reconciliation and account where it was found Receipts for shares of foreign company stock maintained by an intermediary indicating ownership. Accounts Receivable - money owed to a business, i. Back to the top E earnings for ordinary shareholders Profit after deducting interest charges and taxation and after deducting preference dividends but before deducting extraordinary items. Through committees, it develops guidance for specialized industries. Additions might include improvements to the property and subtractions may include depreciation or depletion. Capitalized Expense - Accumulated expenses that are expensed over time. A taxpayer's adjusted basis in property is deducted from the amount realized to find the gain or loss on sale or disposition. Statement of Account - A written document that shows all charges and payments; accounts receivable statement; accounts payable statement. Example: She was training to become an accountant, but in the meantime she had a part-time job as a bookkeeper. Journal - The first place financial transactions are entered. Boards of directors are responsible for the governance of their companies.
The date on which a company comes into existence. Shareholders are, in a way, the owners of a company.
The AICPA establishes ethical and auditing standards as well as standards for other services performed by its members. Person skilled in the recording and reporting of financial transactions.
Example: The accountants were all busy working on the financial statements as the company was planning to refinance its loans.
Journal - The first place financial transactions are entered. If the company is doing well, the value of the shares goes up. Departmental Accounting - Shows individual departments' income, expenses and net profit. The AICPA establishes ethical and auditing standards as well as standards for other services performed by its members. Revenue - The actual amount of money a company brings in during a particular time period; gross income. Bookkeeping The process of recording financial transactions and keeping financial records. Net Definition: An amount of money that is left after taxes have been paid. Value Added Tax Analytical Procedures Substantive tests of financial information which examine relationships among data as a means of obtaining evidence. Goodwill - Intangible asset a business enjoys like its reputation or brand popularity. Interest and income tax expenses are not included.
Capital Definition: Cash and funds, but also machinery and tangible assets that can contribute to earning more money, like computers, company vehicles, etc.
Double Entry Definition: An accounting system in which each transaction is recorded as both a credit and a debit, an asset and a liability. Typical tangible business assets include land, buildings, equipment, cash, vehicles, accounts receivable, etc.
Assembly of Financial Statements The providing of various accounting or data-processing services by an accountantthe output of which is in the form of financial statements ostensibly to be used solely for internal management purposes.
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