Useful Accounting Terms[MIGRATED]
Event or condition that must be recorded in the books of business because its effects on the financial condition of the business, such as buying and selling.

Double Entry
Type of accounting /bookkeeping system that requires every transaction to be recorded in at least two places -- debit and credit. Every transaction is recorded in a "formal" journal as a debit entry in one account and as a credit entry in another account. The summarized balances from the journals are posted (transferred) to a formal business record called the general ledger.

Process of transferring balances from bookkeeping records called journals to a "final" bookkeeping record called the general ledger.

A separate record for each type of asset, liability, equity, revenue and expense used to show the beginning balance and to record the increases and decreases for a period and the resulting ending balance at the end of a period.

General Ledger
A book containing the accounts for all of a business's assets, liabilities, equity, revenue and expense accounts.

A preliminary record where business transactions are first entered into the accounting system. It is commonly referred to as the book of original entry.

Trial Balance
A worksheet listing of all the accounts appearing in the general ledger with the amount of the debit or credit balance of each. Used to make sure the total debits and credits of the journals are equal.

A business document showing the names and addresses of the buyer and seller, date, terms of sale, description, quantity, unit price, total price of goods purchased or sold and method of delivery.

Bank Reconciliation
The process of bringing the bank book and bank statement balances into agreement.

Financial Statement
Accounting reports prepared periodically to inform the owner, creditors and other interested parties about the financial condition and operating results of business.

Balance Sheet
The financial statement that shows the amount and nature of business assets, liabilities and owner's equity at a specific point of time.