常用会计英语词汇22

常用会计英语词汇22

Introduction

Inthefieldofaccounting,itisimportanttounderstandanduseproperaccountingterminologyinEnglish.Thishelpstocommunicateeffectivelywithcolleagues,clients,andprofessionalsintheindustry.Inthisdocument,wewillexplore22commonlyusedaccountingtermsinEnglish,providingdefinitionsandexamplestoenhanceyourunderstanding.

1.Assets

Assetsrefertoresourcesownedbyacompanythathaveeconomicvalue.Theycanincludecash,inventory,equipment,andproperty.

Example:Thecompany’sassetsinclude$100,000incashand$250,000worthofinventory.

2.Liabilities

Liabilitiesarethefinancialobligationsofacompany.Thesecanincludedebt,loans,andaccountspayable.

Example:Thecompanyhas$50,000inliabilities,includinga$25,000loanand$10,000inaccountspayable.

3.Equity

Equityrepresentstheownershipinterestinacompany.Itiscalculatedbysubtractingliabilitiesfromassets.

Example:Thecompany’sequityis$300,000,calculatedbysubtracting$50,000inliabilitiesfrom$350,000inassets.

4.Revenue

Revenuereferstotheincomeacompanygeneratesfromitsbusinessactivities.Itcancomefromsales,services,orothersources.

Example:Thecompany’stotalrevenuefortheyearwas$1,000,000.

5.Expenses

Expensesarethecoststhatacompanyincursinordertooperateandgeneraterevenue.

Example:Thecompany’sexpensesfortheyeartotaled$800,000.

6.IncomeStatement

Anincomestatementisafinancialstatementthatshowsacompany’srevenue,expenses,andnetincomeorlossoveraspecificperiodoftime.

Example:Theincomestatementfortheyearshowstotalrevenueof$1,000,000,expensesof$800,000,andanetincomeof$200,000.

7.BalanceSheet

Abalancesheetisafinancialstatementthatprovidesasnapshotofacompany’sfinancialcondition,showingitsassets,liabilities,andequityataspecificpointintime.

Example:ThebalancesheetasofDecember31,2021,showsassetsof$350,000,liabilitiesof$50,000,andequityof$300,000.

8.CashFlowStatement

Acashflowstatementisafinancialstatementthatshowstheinflowsandoutflowsofcashinacompanyoveraspecificperiodoftime.Ithelpstoanalyzethecompany’sliquidityandcashposition.

Example:Thecashflowstatementfortheyearshowscashinflowsof$900,000andcashoutflowsof$700,000,resultinginanetcashincreaseof$200,000.

9.Depreciation

Depreciationistheallocationofthecostofanassetoveritsusefullife.Itrepresentsthedecreaseinvalueoftheassetovertime.

Example:Thecompanydepreciatesitsequipmentoveraperiodof5years,withanannualdepreciationexpenseof$10,000.

10.Amortization

Amortizationissimilartodepreciationbutisusedforintangibleassets,suchaspatents,copyrights,andtrademarks.

Example:Thecompanyamortizesitspatentoveraperiodof10years,withanannualamortizationexpenseof$5,000.

11.Audit

Anauditisasystematicexaminationofacompany’sfinancialrecordsandstatementsbyanindependentauditortoensureaccuracy,compliance,andtransparency.

Example:Thecompanyundergoesanannualexternalaudittoensureitsfinancialstatementsarefreefrommaterialmisstatements.

12.GAAP(GenerallyAcceptedAccountingPrinciples)

GAAPreferstoasetofaccountingprinciples,standards,andproceduresthatcompaniesmustfollowwhenpreparingfinancialstatements.Itensuresconsistencyandcomparabilityinfinancialreporting.

Example:ThefinancialstatementsarepreparedinaccordancewithGAAP.

13.FIFO(First-In,First-Out)

FIFOisamethodofinventoryvaluationwherethefirstitemspurchasedareassumedtobethefirstitemssold.Thisassumesthatinventorycostsarematchedwithcorrespondingrevenue.

Example:ThecompanyvaluesitsinventoryusingtheFIFOmethod.

14.LIFO(Last-In,First-Out)

LIFOisamethodofinventoryvaluationwherethelastitemspurchasedareassumedtobethefirstitemssold.Thisassumesthatinventorycostsarematchedwithcorrespondingrevenue.

Example:ThecompanyusestheLIFOmethodtovalueitsinventory.

15.EBITDA(EarningsBeforeInterest,Taxes,Depreciation,andAmortization)

EBITDAisameasureofacompany’soperatingperformance.Itexcludesinterest,taxes,depreciation,andamortizationtofocusonthecompany’sprofitabilityfromitscoreoperations.

Example:Thecompany’sEBITDAfortheyearwas$500,000.

16.ROI(ReturnonInvestment)

ROIisameasureoftheprofitabilityofaninvestment.Itiscalculatedbydividingthenetprofitfromtheinvestmentbytheinitialinvestmentamount.

Example:TheROIforthecompany’sinvestmentinanewprojectwas20%.

17.AccrualBasisAccounting

Accrualbasisaccountingrecognizesrevenuewhenitisearnedandexpenseswhentheyareincurred,regardlessofwhencashisexchanged.

Example:Thecompanyusesaccrualbasisaccountingtorecordrevenueandexpenses.

18.CashBasisAccounting

Cashbasisaccountingrecognizesrevenueandexpenseswhencashisreceivedorpd.

Example:Thecompanyusescashbasisaccountingfortaxpurposes.

19.CostofGoodsSold(COGS)

COGSreferstothedirectcostsassociatedwithproducinggoodsorservices.Itincludesthecostofmaterials,labor,andoverhead.

Example:Thecompany’sCOGSfortheyearwas$600,000.

20.NetIncome

Netincome,alsoknownasprofitornetprofit,istheamountleftafterdeductingallexpensesfromtherevenue.Itrepresentsthecompany’soverallprofitability.

Example:Thecompany’snetincomefortheyearwas$200,000.

21.AccountsReceivable

Accountsreceivableareamountsowedtoacompanybyitscustomersforgoodsorservicessoldoncredit.

Example:Thecompanyhas$50,000inaccountsreceivableasofDecember31,2021.

22.AccountsPayable

Accountspayableareamountsowedbyacompan