Vocabulary for Accounting

and Finance

Lesson 4
 accrual basis
accounting
the method of accounting in
which income and expenditure are
recorded at the date they are earned.
 depreciation
the method of allocating the cost
of an asset over its useful life
 expense
show the full cost of
something in the company
 fixed asset
an asset which is not consumed
or sold during the normal course of
business activities
GAAP (generally accepted
accounting principles)
the common set of standards and
procedures used by companies
when preparing financial statements
 levy
impose or collect
 net earnings
a company's total revenue minus the
operating expenses, depreciation, and
interest paid and taxes
 omit
exclude, leave out
 reducing balance
depreciation
a method of deprecation which
imposes a set rate of depreciation on
the remaining balance of the asset
 revenue
the amount of money a
company receives over a given
time frame
Thank You!