Business, Legal & Accounting Glossary
A written list of transactions, noting money owed and money paid; a detailed statement of mutual demands arising out of a contract or a fiduciary relationship.
In accountancy, an account is a label used for recording and reporting a quantity of almost anything. Most often it is a record of an amount of money owned or owed by or to a particular person or entity, or allocated to a particular purpose. It may represent amounts of money that have actually changed hands, or it may represent an estimate of the values of assets, or it may be a combination of these.
An account can simply list payments, losses, sales, debits, credits, and other monetary transactions, or it may go further and show a balance or the results of comparing opposite transactions, like purchases and sales. Businesspersons keep accounts; attorneys may keep escrow accounts; and executors must keep accounts that record transactions in administering an estate.
Account represents financial and non-financial transactions of a firm, to know the total outcome of the investment made by investors.
An account is a record in an accounting system that tracks the financial activities of a specific asset, liability, equity, revenue, or expense. These records increase and decrease as the business events occur throughout the accounting period. Each individual account is stored in the general ledger and used to prepare the financial statements at the end of an accounting period.
There are five main types of accounts used in an accounting system.
Each of these are represented in the expanded accounting equation. Assets = Liabilities + Owner’s Equity + Revenues – Expenses.
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This glossary post was last updated: 28th December, 2021 | 0 Views.