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Basics of Accounting

The document provides an overview of accounting basics including assets, current and non-current assets, liabilities, current and non-current liabilities, equity, revenue, and expenses.

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Hasib Qureshi
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26 views

Basics of Accounting

The document provides an overview of accounting basics including assets, current and non-current assets, liabilities, current and non-current liabilities, equity, revenue, and expenses.

Uploaded by

Hasib Qureshi
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as DOCX, PDF, TXT or read online on Scribd
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Basics of accounting All those liabilities which the entity expected to pay

after one year


Assets
 Bonds payable
Assets are economic sources that are owned
 Mortgage payable
by a business and are expected to benefit in future
 Long term notes payable( bank loans)
Assets are divided into two main categories  Warranty payable

Current assets

Non- current assets or fixed assets Equity

Current assets Equity represent the owner’s claims to the assets of


the business
All those assets which are expected to be used up or
converted into cash within a year  Capital stock
 Retained earning
 Cash in hand
 Owner’s drawing
 Cash at bank
 Income and expense summary
 Notes receivable
 Account receivable Revenue is the total amount of money received by the
 Interest receivable company for goods sold or services provided during a
 Allowances for bad debts certain time period
 Inventory
 Sales
 Supplies used
 Commission
 Prepaid insurance
 Fees
 Furniture and fixture
 Rent income
 Equipment
 Interest income
 Building
 Dividend income
 Depreciation on building, furniture, fixture
 Office supplies Expenses
 Prepaid expense
An expense in accounting is the money spent or cost
Non-current asset or fixed asset incurred in an entity’s effort to generate revenue.
Expenses represent the cost of doing business
All those assets which are not expected to be used up
or converted into cash within one year  Transportation
 Salaries
Sub – divided into two categories
 Rent
Tangible assets  Interest expense
 Utility expense
Intangible assets
 Depreciation expense
Liabilities  Selling expense
 Bad debts
Liabilities are debt of an organization

Current liabilities

All those liabilities whose payment is due within a


year

 Account payable
 Notes payable
 Unearned
 Salaries payable
 Interest payable

Non- current liabilities or long term liabilities

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