What is financial literacy? Questions About Accounting Terms What is a simple definition of accounting? Double-entry accounting records all transactions twice: once as a debit, and once as a credit. Transactions are recorded in a document known as a "cash book." It contrasts with the more precise and accurate double-entry accounting method. It is also known as single-entry accounting.Single-entry systems are simplified financial tracking methods often used exclusively by small businesses. Single-Entry Bookkeeping: Single-entry bookkeeping records all revenues and expenses with a single entry in the company's books. For example, revenue is used to establish the datapoint comprising the "sales" component of a price-to-sales calculation. It would not cover additional sources of income, such as the liquidation of equipment or real estate owned by the business.The terms "revenue" and "sales" can be synonymous. For example, a restaurant's revenue covers all food and beverage sales. Revenue (REV) describes the income a business earns by selling products and/or services associated with its main operations. Refresh knowledge gained in an accounting programĬonsider reading these additional accounting student resources:.Build familiarity with accounting essentials prior to commencing studies.Gauge interest in a potential accounting career before applying to programs.This guide is an easy-to-use resource for developing the vocabulary accounting professionals use. Some students enter accounting programs with little technical knowledge - and that is OK. It was developed for students and entrepreneurs to build their familiarity with accounting vocabulary. This is an alphabetized glossary of accounting terms. The following guide explains key accounting definitions and terms. General accounting knowledge can be important for individual income-earners during tax season. However, everyone can benefit from a knowledge of accounting basics. In the modern world, it is most closely associated with businesses' financial reporting. The history of accounting dates back to ancient times. Accounting also serves as a useful way for people and companies to honor their tax obligations. People and businesses use the principles of accounting to assess their financial health and performance.
Readers of this website should contact a professional advisor before making decisions about financial issues.Īccounting is the process of tracking and recording financial activity. Transactions must be approved and carry all the correct authorizing signatures.DISCLAIMER: The information provided on this website does not, and is not intended to, constitute professional financial advice instead, all information, content, and materials available on this site are for general informational purposes only. The documentation must be retained, organized, and complete enough to stand up to an audit. Sufficient documentation to support the transaction must exist. There must be a reason for the transaction that supports the project's goals, and adheres to guidelines outlined by federal agencies, a private sponsor, and Drexel University.
Transactions must be handled within a reasonable period of time consistent with time frames outlined for federal agencies, a private sponsor, and Drexel University. That is, policies and procedures have been established to address similar types of transactions in a routine manner. Transactions must be handled in a consistent manner. The five principles are consistency, timeliness, justification, documentation, and certification. Policies and procedures within Research Accounting Services have been developed in support of these principles. There are five overall principles to managing the financial transactions of sponsored research funds. Five Principles of Financial Transactions Management