Accounting Terms Flashcards

Front

Trade Receivables

Back

The amounts owed to a business by its customers for goods sold or services rendered on credit.

Front

Stock/Inventory

Back

Goods or raw materials held by a business for sale in the ordinary course of business, in the process of production for such sale, or in the form of materials or supplies to be consumed in the production process or in the rendering of services.

Front

Discount

Back

A reduction in the price of goods or services.

Front

Revenue From Operations

Back

The revenue generated by a company from its primary business activities. E.g., sales of products by a manufacturing company or fees earned from providing services by a consulting firm.

Front

Debtors (Accounts Receivable)

Back

Individuals or entities who owe money to the business for goods sold or services rendered on credit. E.g., a customer who bought goods on credit and has not yet paid, or a client who received services but has not yet settled the invoice.

Front

Vouchers

Back

Documentary evidence of a financial transaction. E.g., cash memo for a cash purchase, invoice for a credit sale, receipt for payment made.

Front

Bills Receivable

Back

Written promises from customers (debtors) to pay a specific sum of money on a definite future date. These are legally enforceable documents. E.g., a business receiving a promissory note from a customer or a bill of exchange accepted by a customer for goods purchased.

Front

Bad Debts

Back

Amounts owed to the business by debtors that are considered uncollectible and are written off as a loss. For example, a customer filing for bankruptcy and unable to pay their outstanding balance, a debtor disappearing without a trace, or a long-overdue debt for which all collection efforts have failed.

Front

Balance Sheet

Back

A financial statement that presents a snapshot of a company's financial position at a specific point in time.

Front

Book Value

Back

The value of an asset as recorded in the company's accounting records, typically calculated as its original cost less accumulated depreciation.