ACCOUNTING
The science of recording, classifying and summarizing in a significant manner and in terms of money, transactions and events which are, in part at least, of a financial character and interpreting the results thereof.
ACCOUNT PAYABLE
Payment due to someone who has extended credit or services to the chapter.
ACCOUNT RECEIVABLE
Payment due to the chapter from someone who has received credit from the chapter.
ACCRUAL BASIS
One of two main accounting methods for recording revenue and expenses. Entries for REVENUE are recorded in the period when earned rather than only when the cash is received. Entries for EXPENSES are recorded when incurred rather than only when paid. (The Phi Kappa Tau bookkeeping system employs the accrual basis accounting method.)
AMORTIZATION
The liquidation of a financial obligation on an installment basis.
ASSETS
The property right or value acquired, or expenditure made which has a property right or is applicable to the future. In brief: those things of value owned by a business, entity or individual.
ASSETS (CURRENT)
Cash and other assets that may reasonably be expected to be realized in cash or consumed during the normal operating cycle of the business. Current assets include cash, notes receivable, inventories and prepaid expenses.
BALANCE SHEET
One of two main financial statements prepared by accountants. A balance sheet is a tabular summary of balances showing the financial position of a business on a specific date. The composition of the balance sheet is defined in terms of the following equation: Assets = liabilities + owner's equity
BOND
Any interest bearing certificate issued by a government or corporation.
INCOME STATEMENT
One of the two main financial statements prepared by accountants. The income statement summarizes the results of operations for a designated period of time. The statement indicates whether a business has operated on a profit (called net income) or on a loss during the period.
EXPENSE
The cost incurred to operate a business.
LOSS: The expenses of a business exceed its revenue.
MORTGAGE: A conditional conveyance of property as security for the payment of a debt or the performance of some other obligation.
MORTGAGOR
(or MRTGAGER): One who gives a mortgage.
MRTGAGEE: A person to whom property is mortgaged.
NET WORTH: What the chapter owns (assets) less what (EQUITY) it owes (liabilities).
NOTE: A written or printed paper acknowledging a debt and promising payment.
REVENUE: The inflow of assets in the form of cash, receivable or from income from other sources.
ASSET UPGRADE FUND: A fund to which periodical contributions are made for the purpose of ultimately paying or replacing assets of some kind.
SIMPLE INTEREST: Interest calculated on a principal sum but not on any interest that has been earned by that principal sum. : definition