Learn the basics of “Accountant-ease!” when you familiarize yourself with these 6 key terms:
1. Accounts Payable=(A/P). Everything that you owe.
2. Accounts Receivable=(A/R). Income not received yet.
3. Accrual Basis. An accounting method that records income as it is invoiced.
4. Cash Basis. An accounting method that records income as its received.
5. Assets. The physical items you own that have value.
Current Assets are generally used within 12 months.
Fixed Assets are things like vehicles, furniture, and property.
6. Average Cost. An inventory costing method that calculates the value of stock.