Giving examples, explain each of the following accounting terms
Fixed assets,Gain,ProfitRevenue,Expenses, Short term liabilityCapital
Giving examples, explain each of the following accounting terms
Fixed assets,Gain,ProfitRevenue,Expenses, Short term liabilityCapital
Fixed Assets: Fixed assets are those assets which last for a long period of time such as plant and machinery, building, land etc.
Gain: A profit that arises from events or transactions which are incidental to business such as sale of fixed assets, winning a court case, appreciation in the value of an asset.
Profit: The excess of revenues of a period over its related expenses during an accounting year is termed as profit. Profit increases the investment of the owners.
Revenue: These are the amounts of the business earned by selling its products or providing services to customers such as commission, interest, dividends, royalties, rent received etc.
Expenses: Costs incurred by a business in the process of earning revenue are known as expenses such as rent, wages, salaries, interest, cost of heater, light and water, telephone etc.
Short-Term Liability: Short-term liabilities are obligations that are payable within a period of one year, i.e., creditors, bills payable, bank overdraft.
Capital: Amount invested by the owner in the firm is known as capital. It may be brought in the form of cash or assets by the owner for the business.
Fixed Assets: Fixed assets are those assets which last for a long period of time such as plant and machinery, building, land etc.
Gain: A profit that arises from events or transactions which are incidental to business such as sale of fixed assets, winning a court case, appreciation in the value of an asset.
Profit: The excess of revenues of a period over its related expenses during an accounting year is termed as profit. Profit increases the investment of the owners.
Revenue: These are the amounts of the business earned by selling its products or providing services to customers such as commission, interest, dividends, royalties, rent received etc.
Expenses: Costs incurred by a business in the process of earning revenue are known as expenses such as rent, wages, salaries, interest, cost of heater, light and water, telephone etc.
Short-Term Liability: Short-term liabilities are obligations that are payable within a period of one year, i.e., creditors, bills payable, bank overdraft.
Capital: Amount invested by the owner in the firm is known as capital. It may be brought in the form of cash or assets by the owner for the business.
