Definitions Flashcards
1
Q
What is an Asset?
A
Anything that belongs to the business and has current or future value for the business.
2
Q
What is a Liability?
A
Refer to the amount a business owes to external parties.
3
Q
What is Owner’s Equity?
A
The amount of the owner’s interest or investment in the business.
4
Q
What is an Expense?
A
A cost that businesses incur while running their operations.
5
Q
What is a Revenue?
A
The total amount of income generated by the sale of goods or services related to the company’s primary operations.
6
Q
What is a Balance Sheet?
A
A list of all the assets, liabilities and owner’s equity of a business at a particular point in time.
7
Q
Define Accounting Entity Assumption
A
A policy that separates the owner’s transactions from the business for accounting purposes.
