March 10, 2010 by Elizabeth Hale
Unless you are an accountant, you may not know what people are talking about when they mention certain terms. Human nature dictates that we’re either embarrassed or ashamed to ask what certain words mean. In the event you have been hearing terms that you are unfamiliar with, let’s go over a few commonly used terms.
First things first, the word account has many different meanings. When the term is used in accounting, it is used to refer to different types of accounts that are held within a corporation; like sales accounts, accounts receivable and cash accounts.
A company may have several different types of accounts, like cash accounts, receivables and sales. These are some of the most common types of accounts that businesses have that keep the money straight.
An annuity is a return on an investment that renders the same amount of money in the same intervals of time. This is like when you get an interest check each year, at the same time of year. It’s something that you can rely on.
When you have debt, it is referring to the amount of money that you owe to another person, or a lending institution. Many times, when your debt is greater than your worth, you are said to be in an upside down situation.
When a company or person has debt, it is something that they owe to others. This amount is subtracted from your worth and assets. This amount is the price plus any interest payments you may owe a financial institution or lender. Debt is usually looked at most closely when you are applying for credit.
Typically, a gain and a loss relate to your end of year ledgers. When you get something monetarily over and above what you paid for your investment or article that you sold, you call it a gain. Gains must be taxed or levied by the government and Internal Revenue Service.
A loss is something that you have when you sell an asset and you actually lose money on the deal. This would include a scenario where someone purchases shares of stock for $1 per share. They then sell the stock and only get. 50 for the shares. This is taking a loss.
You’ll hear people talk about r and d and r and d costs. This simply refers to research and development, which is a huge part of any and all corporate infrastructure. It weighs heavily when dealing with businesses and accounting.
Standard cost is something that is a set cost for an item or service. It helps people estimate what sort of costs they will be incurring in the future for particular things that they know they will need. This can help business in large part, make budgets for the year.
These are several of the thousands of terms that are used in accounting. To find more, you can look online and learn all about the world of accounting and certified public accountants.
It depreciates from the moment you drive it off the lot. Accounting Jobs Scottsdale There are people who are just born with these skills, and hopefully, they all become accountants. They should a;sp be able to quickly define these during the interview process.
