NCEA L2 Accounting - Correct Language, not money

Resources owned by a business that have future economic value. Examples include cash, inventory, equipment, and property.

• Drawings
• Non-Current Liabilities
• Assets
• Current Assets

Debts or obligations owed by a business to external parties. Examples include loans, accounts payable, and accrued expenses.

• Inventory
• Liabilities
• Profit Margin
• Property, Plant, and Equipment (PP&E)

This represents the owner's claim on the company's assets and is calculated as assets minus liabilities.

• Accounts Receivable
• Equity
• Drawings
• Income Statement

Withdrawals of cash or other assets made by the owner(s) of a business for personal use. Drawings are not considered expenses because they do not relate to the operation of the business. They are recorded as a reduction of the owner's equity in the business

• Cost of Goods Sold (COGS)
• Drawings
• Assets

The income generated from the sale of goods or services. It is typically recorded when it's earned, regardless of when the payment is received.

• Revenue
• Drawings
• Allowance for Doubtful Debts
• Net Profit

The costs incurred in the process of generating revenue. Examples include salaries, utilities, rent, and supplies.

• Bad Debts
• Cost of Goods Sold (COGS)
• Equity
• Expenses

Also known as profit or earnings, a company's total revenue less total expenses over and cost of sales in a specific period.

• Cash Flow Statement
• Cash Flow
• Non-Current Assets
• Net Profit

The direct costs attributable to the production of goods sold by a company. It includes the cost of materials, labor, and overhead directly involved in production.

• Balance Sheet
• Cost of Goods Sold (COGS)
• Non-Current Liabilities
• Accounts Receivable

The money owed to a business by its customers for goods or services sold on credit. It represents a company's right to receive payment.

• Cash Flow
• Bad Debts
• Accounts Receivable
• Net Profit

The money owed by a business to its suppliers or vendors for goods or services purchased on credit. It represents a company's obligation to pay its debts.

• Current Liabilities
• Profit Margin
• Bad Debts
• Accounts Payable