Accounting
The process of keeping track of a business' finances
Debit
Left side of the T-chart
Credit
Right side of the T-chart
Accounting Equation
Assets = Liabilities + Equity
Double entry method
Must be balanced - meaning both sides of the equation must be equal
Accounting Cycle
The process of recording and processing the accounting events of a company
Balance Sheet
A financial statement that provides information about a company's present condition
Income Statement
A financial tool that provides information about a company's past performance
Sole Proprietorship
business owned and operated by one person
Partnership
a business organization owned by two or more persons who agree on a specific division of responsibilities and profits
Corporation
An organization that is made up of many owners who are not normally in the decision-making and operations of the business, but they have an interest in the company
LLC
A business type that combines the benefits of partnership's flexibility and a corporation's protection
Transaction
Any event or activity that can be measure in terms of money
Asset
An item of value owned by a company
Liability
obligations of the business to transfer something of value to another party
Equity
Indicates the value of a company to its owners