Glossary

Question 1

Aged debtors ledger

Answer 1

A record of the amounts that each individual customer owes you.

Question 2

Aged creditors ledger

Answer 2

A record of the amounts that the entity owes to each supplier.

Question 3

Balance sheet

Answer 3

A financial statement giving details of entity’s financial position at a particular point in
time, made up of assets, liabilities and capital.

Question 4

Chart of Accounts

Answer 4

A listing of all accounts used in the nominal ledger of an entity.

Question 5

Financial Statements

Answer 5

The collection of reports prepared by an entity including the balance sheet and profit
and loss account.

Question 6

Journal Entry

Answer 6

The debits and credits of a transaction entry into the accounting system.

Question 7

Ledger

Answer 7

A paper or electronic book/ file for recording the financial transactions.

Question 8

Nominal ledger

Answer 8

The ledger where all the accounting transactions are held. It will include details of all
assets, liabilities, capital, income and expenses. This is also commonly referred to
as the general ledger.

Question 9

Profit and Loss Account

Answer 9

A financial statement showing an entity’s net profit or loss in a given period, including
details of income and expenses.

Question 10

Sales Invoice

Answer 10

A document that you send to your customer detailing the transaction and the
amounts they are due to you.

Question 11

Supplier Invoice

Answer 11

A document that you receive from a supplier when you purchase a good or service
from them.

Question 12

Trial Balance

Answer 12

The period end summary of the balances within each nominal ledger account.