Assets Includes accounts that summarise the value of 

items owned by a business(for example

land, motor vehicles, building, equipment, office furniture, stock)

Liabilities Includes accounts that summarise the amounts owed by the business to external
parties (for example loans from banks or finance companies, mortgage on buildings
and also in the shorter term  - unpaid bills)

Expenses Includes accounts that summarise the outflow of money from a business or the loss or
wastage of the business’s resources. For example money is spent purchasing stock for
resale, and on telephone, electricity, rent, rates, wages and motor vehicle expenses).

Revenues Includes accounts that summarise the inflow of money into a business resulting from
the sale of inventories, services performed and general operations of the business (for
example sales, rent received, commission received).

Ownership This is the owner’s investment or interest in the business. Ownership equity can always
Equity be worked out as the difference between the total of assets less the total of liabilities.  

Accounts receivable (AR) definition: The amount of money owed by customers or

clients to a business after goods or services have been delivered and/or used.

Accounting (ACCG) definition: A systematic way of recording and

reporting financial transactions for a business or organization.

Accounts payable (AP) definition: The amount of money a company owes creditors

(suppliers, etc.) in return for goods and/or services they have delivered.  

Assets (fixed and current) definition: Current assets (CA) are those that will be
converted to cash within one year. Typically, this could be cash, inventory or accounts
receivable. Fixed assets (FA) are long-term and will likely provide benefits to a
company for more than one year, such as a real estate, land or major machinery.  

Asset class definition: An asset class is a group of securities that behaves similarly in
the marketplace. The three main asset classes are equities or stocks, fixed income or
bonds, and cash equivalents or money market instruments.

Balance sheet (BS) definition: A financial report that summarizes a company's assets

(what it owns), liabilities (what it owes) and owner or shareholder equity at a given
time.

Capital (CAP) definition: A financial asset or the value of a financial asset, such as

cash or goods. Working capital is calculated by taking your current assets subtracted
from current liabilities—basically the money or assets an organization can put to work.

Cash flow (CF) definition: The revenue or expense expected to be generated through

business activities (sales, manufacturing, etc.) over a period.

1. Prepaids

Marilyn brings up another less obvious asset—the unexpired portion of prepaid

expenses. Suppose Direct Delivery pays $1,200 on December 1 for a six-month
insurance premium on its delivery vehicle. That divides out to be $200 per month
($1,200 ÷ 6 months). Between December 1 and December 31, $200 worth of insurance
premium is "used up" or "expires". The expired amount will be reported as Insurance
Expense on December's income statement. Joe asks Marilyn where the remaining
$1,000 of unexpired insurance premium would be reported. On the December 31
balance sheet, Marilyn tells him, in an asset account called Prepaid Insurance.