What will I find in the Glossary?

Here you will find the definition of words you might not know the meaning of. This is so you don't have to go google the meaning and fnd a really confusing definition.

• Asset: An Asset is what the business owns, things like cash, buildings, inventory and equipment is an asset.
• Liabilities: A Liability is what the business owes, things like a mortgage, loan and accounts payable is a liability.
• Equity: Equity is the owners money/share of their business. It represents the net worth of the business.
• Income/Revenue: Revneue is another word for income. it's the money a business earns from sales.
• Expenses: An expense is the cost a business encounters to operate. Petrol, wages, repaird and maintenance, rent and interest on loan are all expenses.
• Profit: Profit is the money you have left over after paying for expenses.
• Accounts Payable: Accounts Payable is money the business owes to suppliers. This is classified as a liability.
• Accounts Receivable/Debtors: Accounts Receivable is another word for debtors it is money the customers owe to the company. This is classified as an asset.
• Petty Cash: Petty Cash is a small amount of money kept by a business to pay for day-to-day expenses.
• Inventory: Inventory is the stock of a business's goods held for sale like clothes. This is an asset.
• Interest: There are 2 different types of interest there is an interest received and an expense interest. Interest received is often earned by a term deposit and classified as revenue. Expense interest is a fee the business has to pay for borrowing money, this is an expense.
• Drawings: Drawings is the withdrawal of money by the owners from a business for their personal use.
• GST: GST is a goods and services tax, classified as an expense.
• Income Statement: An Income Statement is a financial document that shows the business's income and expenses to calculate the total profit.
• Statement of Financial Position: A Statement of Financial Position is also known as a balance sheet, it is used to show a business's financial health.
• Trial Balance: A Trial Balance is a report of all the Assets, Liabilities, Income, Expenses and Equity of a business.