Welcome to the Accounting Flashcards Tool. This is designed as a simple supplementary resource for the textbook ‘Short Introduction to Accounting’, and aims to help students grasp the meaning of the core essential terms within the book. Each term will appear on its own, and you can then click to check the definition. Click or press [space] to begin.

Accounts payable [ click for answer ] term: 1 of 11

A liability comprising amounts for which an invoice has been received but cash settlement remains outstanding. [ click for next term ] definition: 1 of 11

Accounts receivable [ click for answer ] term: 2 of 11

An asset comprising amounts that have been invoiced but cash has yet to be received. [ click for next term ] definition: 2 of 11

Accounts receivable turnover [ click for answer ] term: 3 of 11

A ratio measuring the time taken to collect cash from customers, defined as (accounts receivable/annual revenue) * 365 days. [ click for next term ] definition: 3 of 11

Asset [ click for answer ] term: 4 of 11

A valuable resource owned by the reporting entity. [ click for next term ] definition: 4 of 11

Balance sheet [ click for answer ] term: 5 of 11

A financial statement that reports an entity’s assets, liabilities and equity at a point in time. [ click for next term ] definition: 5 of 11

Book value [ click for answer ] term: 6 of 11

The amount at which an item is recorded in the balance sheet. [ click for next term ] definition: 6 of 11

Capital employed [ click for answer ] term: 7 of 11

The total value of an entity’s equity plus debt. [ click for next term ] definition: 7 of 11

Cash flow statement [ click for answer ] term: 8 of 11

A financial statement that reports changes in an entity’s cash balance during a reporting period, categorised into operating, investing and financing activities. [ click for next term ] definition: 8 of 11

Cost of capital [ click for answer ] term: 9 of 11

The percentage return on capital that providers of finance expect to earn. [ click for next term ] definition: 9 of 11

Cost of goods sold [ click for answer ] term: 10 of 11

Expenses that are directly attributable to units of output, notably materials and other components of inventory. [ click for next term ] definition: 10 of 11

Current asset [ click for answer ] term: 11 of 11

An asset that is expected to be converted into cash within one year, notably inventory, accounts receivable and cash. [ End of flashcard 1 ] definition: 11 of 11