Accounting Terms Flashcards
Service fee
revenue received in advance
Refers to service fee revenue received before services are provided.
A Current Liability.
Income received
in advance
Refers to other income received before services are provided. Current Liability.
Income receivable
Refers to other income where services have been provided but the amounts have not been received. Current Asset.
Expenses payable
Refers to services used but have not been paid for. Current Liability.
Prepaid expenses
Refers to other expenses that have been paid in advance before services are used. Current Asset.
Impairment loss on inventory
Refers to the expense incurred when inventory’s net realizable value falls below its cost. Expense
Trade receivables
The amounts owed by customers who buy goods and services from businesses on credit.
Allowance for
impairment of
trade receivables
The amount of trade receivables estimated to be likely uncollectible.
A contra-asset (reduce CA)
Impairment loss
on trade
receivables
Refers to the loss associated with uncollectible debts from credit sales. Expense
Depreciation
The allocation of cost of a non-current asset over its estimated useful life
Accumulated
depreciation
The total depreciation to date
Net book value
The remaining value of a non-current asset after taking into account accumulated depreciation NBV — Cost — Accumulated depreciation
Trade payables
The amounts owed to suppliers when businesses buy goods and non-current assets on credit.
Shareholders’
Equity
Claim by the shareholders on net assets of the private limited company
Share capital
Cash raised by issuing shares to shareholders
