Accounting glossary

 

Accounting Glossary

Hi, my name is Jenine Abou Zelouf. I am 19 years old, and I have been studying at College Ahuntsic for a year and half. I am studying Social Science, more precisely in administration. I want to study Accounting at the university, so that’s why I create this glossary. This glossary contains 20 words related to accounting that will help to understand different concepts from this field. Each word will have a definition, an audio pronunciation to help people say the word correctly, an example of how we can use the word in a sentence and a traduction in French.

accumulated depreciation
noun
The total depreciation on a tangible asset accumulated up to a specified date.This amount is subtracted from the original cost or valuation of the asset to arrive at its book value.
Example: A company purchased a piece of printing equipment for $100,000 and the accumulated depreciation is $35,000.
fr: dépréciation accumulée
asset
noun
An item of property owned by a person or company, regarded as having value and available to meet debts, commitments, or legacies.
Example: A building is an asset for a company.
fr: actif
balance sheet
noun
A financial statement that summarizes a company's assets, liabilities and share-holders' equity at a specific point of time.
Example: The balance sheet is one of the mains financial statements.
fr: bilan
breakeven point
noun
The point at which the income from sale of a product or service equals the invested costs, resulting in neither profit nor loss; the stage at which income equals expenditure.
Example: BREAKEVEN POINT = 16000 (55-20-1 6) = 842units < maximum capacity Eve.
fr: seuil de rentabilité
cash cycle
noun
The length of time between the purchase of raw materials and the collection of accounts receivable generated in the sale of the final product.
Example: I bought gold on the market and after a certain time I sold it and received a lot of cash.
fr: cycle de trésorerie
cash flow
noun
The total amount of money being transferred into and out of a business, especially as affecting liquidity.
Example: Having a fixed budget allows the management to more accurately forecast the company's cash flow and better invest other funds.
charge off
noun
The declaration by a creditor (usually a credit card account) that an amount of debt is unlikely to be collected. This occurs when a consumer becomes severely delinquent on a debt.
Example: A electricity bill is a charge for a company.
fr: radiation
current liabilities
noun
Obligations such as deferred dividend, trade credit and unpaid taxes, arising in the normal course of a business and due for payment within a year.
Example: The easy solution was to make discounts to customers and have bank loans to cover current liabilities.
fr: passif courant
deferred revenue
noun
Revenue that is considered a liability until it becomes relevant to the business at hand, such as a payment received for work that has not yet been performed.
Example: Stephen Penman, in his article (2003) on the quality of financial statements, puts forth certain changes that need to be implemented: An analysis of net revenue, a reconciliation of gross revenue to net revenue and a breakdown of booked and DEFERRED REVENUE is needed.
fr: Revenu reporté
expenditure
noun
The act of expending something, especially funds; disbursement; consumption.
Example: To see the economy as a whole, income equals EXPENDITURE and also equals the value of output, we study the circular flow of income and EXPENDITURE.
fr: dépense
functional currency
noun
Currency of the country (called the “primary environment”) in which a firm conducts its business activities and generates most or all of its income and expenses.
Example: The functional currency of Canadian companies is Canadian dollars.
fr: monnaie fonctionnelle
goodwill
noun
An intangible asset that arises as a result of the acquisition of one company by another for a premium value.
gross profit
noun
Sales minus all costs directly related to those sales, including manufacturing expenses, raw materials, labor, selling, marketing and other expenses.
Example: Both Audi and Hyundai show a relatively stable GROSS PROFIT margin.
fr: bénéfice brut
margin of safety
noun
An excess of a company’s actual sales revenue over the breakeven sales revenue, usually expressed as a percentage.
fr: marge de sécurité
operating expenses
noun
An expense incurred in carrying out an organization’s day-to-day activities, but not directly associated with production.
Example: These cash generated from operating activities are the primary source of finance used to fund the ongoing OPERATING EXPENSES, tax and interest payments, capital expenditure and dividend payments.
fr: charges d'exploitation
overdraft
noun
A loan arrangement under which a bank extends credit up to a maximum amount against which a current checking account customer can write checks or make withdrawals.
Example: Thus, because of the importance of cash position in a business, managers often plans cash movements in advance, which enable them to be confident of adequate cash, or to have enough time to negotiate OVERDRAFT facilities.
fr: découvert
prime cost
noun
The direct cost of a commodity in terms of the materials and labor involved in its production, excluding fixed costs.
Example: The overhead costs of production are added to the PRIME COST, which comprised direct materials and direct labour for each unit.
fr: premier prix
retained earnings
noun
Profit generated by a company that is not distributed to shareholders as dividends but is either reinvested in the business or kept as reserve for specific objectives.
Example: Now we assume firms decided to implement the policy of translating its RETAINED EARNINGS in the form of share repurchases, in which case all gains are taxed at the capital gains rate.
fr: bénéfices non répartis
tangible asset
noun
Equipment, machinery, plant, property that has long-term physical existence or is acquired for use in the operations of the business and not for sale to customers.
Example: Land, vehicles, equipment, machinery, furniture, inventory.
fr: actif tangible
transfer pricing
noun
The price that is assumed to have been charged by one part of a company for products and services it provides to another part of the same company, in order to calculate each division’s profit and loss separately.
Example: As a reaction, most countries passed TRANSFER PRICING rules - which tackle this practice by removing artificial business conditions relied upon by sister companies within multinationals corporations.
fr: prix de transfert

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