S&P's Financial Focus

Accounting Terms

Whether working with a professional accountant, or doing your own books, you will need to understand accounting terms.

Make a Chart Use the following information to make a chart of accounting terms:

GAAP Generally accepted accounting principles

Accounting period Specific block of time in which businesses make financial reports

Financial reports Documents that summarize the results of your business operations and financial picture

Fiscal year A business year can begin and end in months other than the calendar year, which begins January 1 and end December 31

Assets Everything the business owns

Current assets Cash or other items that can be converted to cash quickly and are used by the business within a year

Fixed assets Items that will be held for more than one year, such as buildings, trucks, or equipment

Accounts receivable Amount customers owe your business

Liabilities Business debts

Accounts payable Amount your business owes to creditors

Owner's equity Worth of the business, which is calculated by subtracting the total amount of liabilities from the assets.

Standard and Poor’s publishes the globally recognized S&P 500® financial index and provides credit ratings. It also gathers financial statistics, information, and news, and analyzes this data to help individuals, companies, and governments make financial decisions. Go to www.standardandpoors.com to learn more about this company.