The accounting definition of depreciation is often one that confuses a lot of people. In this post, the meaning of depreciation will be explained to you in simple language using a simple example – that of a banana.
Accounts receivable is a basic accounting word but its definition is often explained in a confusing way. In this post, you’ll have accounts receivable explained in a way where you can finally understand its meaning – both the big picture and in detail.
A general ledger is the backbone of an accounting system – but the dictionary definition and meaning is a bit complicated and confusing. In simple terms – it’s an organization system on steroids. Just like a wardrobe that’s organized in such a way where you can find anything.
Equity is one of those scientific sounding words that you’ll likely hear about when you borrow to buy a house, seek investment or bring in a partner for a business. But it’s not hard at all to understand what equity means. In a nutshell, it pretty much means the dollar or percentage amount of ‘real’ ownership you have in something.
Does your face go blank when your accountant or banker asks you about your liabilities? “Liabilities” is a word that is a basic part of running a business and for life in general (did you know your credit card debt was a liability?) so knowing what it means helps you become more financially savvy and hopefully, less stressed out. Learn what it means (in plain and simple English)
What’s accounts payable? The meaning of accounts payable is that it is an account that holds all the amounts that you need to pay people. Think of it as a compartment that holds all your IOUs.
Don’t know what the meaning of asset is when it’s used in accounting? I’m going to explain to you the definition of what an asset is in simple and plain English.
Download the following image for use in Unit 10 Activity 2, Part 1. You can download it by right-clicking on it and saving it somewhere.
Download the case study for the fictitious company — Cafe Catering Pty Ltd here:
The below are files that you will need to complete Unit 23 Activity of the Xero for Day-to-Day Business bookkeeping: