Introduction to Accounting

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Accounting

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The system of recording and summarizing business and financial transactions and analyzing, verifying, and reporting the results.

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Balance Sheet

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A balance sheet is a financial statement that reports a company's assets, liabilities, and shareholder equity.

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Cash Flow

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Cash flow is the net balance of money that moves in and out of a business over a specific period of time.

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Debt Capital

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Debt capital is money a company borrows from outside sources, in the form of a loan, that must be repaid with interest.

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Equity Capital

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Equity capital is a company's capital that is not tied to debt, and is often obtained through the sale of stock/shares to investors. It can also refer to surplus earnings or stock.

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Financing

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Financing is the process of providing funds for business activities, making purchases, or investing. Financial institutions such as banks are in the business of providing capital to businesses, consumers and investors to help them achieve their goals.

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Fixed Assets

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1. Assets which are purchased for long-term use and are not likely to be converted quickly into cash, such as land, buildings, and equipment.

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Assets

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An asset is anything of monetary value that a company owns. This includes cash, accounts receivable, merchandise inventory, equipment, fixtures, supplies, land, and buildings.

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Budget

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An estimated amount of money you plan to take in (income) or spend (expenditure) during a certain period.

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Capital

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The money used to build, run or grow a business. Can also refer to the net worth of a business where assets exceed liabilities (debt).