Accounting unit-1

Accounting Unit-1

• Terms
• Creditor: A person or business that has extended creditor or loaded money to another credit or loaded money to another individual or business .
• Financial position: The financial status of a person or company represented by the assets, liabilities, and net worth or personal equity.
• Personal net worth. The difference between the cost6 of items owned and debits owned; also referred to as personal equity.

Slide 2

• Assets: Items of values owned by a person or business.
• Liabilities: Something you owe to someone or a business .
• Personal equity: Is the person's net worth
• balance sheet equation: The basic accounting equation: A= L +OE
• Balance entity principal: Each business be considered a separate entity.
• Balance Sheet: A formal financial statement that lists assets, liabilities, and owners equity at "Statement of financial position.
• Owner's equity: The owners claim against the assets of the company

Slide 3

• Equity: Claims against assets
• Liquidity order: The order in which assets can be converted to cash
• Cost principal: Assets must be shown on the balance sheet using the of their acquisition
• booking preparing and recording information in accounting