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Simple Business


2.1.8. Bookkeeping & Accounting Terms
Account
A holding of monetary value. Va lue is
added to the account or re moved fro m
the account using credit and debit
entries.
Cash book
A record of cash received for each day
of operation.
Chart of accounts
A list of the accounts ma intained within
an accounting system.
Cred it
An entry in an account that records a
reduction in the value of the account.
Debit
An entry in an account that records an
increase in the value of an account.
Depreciat ion
An expense reflect ing the reduction in
the value of an asset over time . This
e xpense represents a reduction in value
and a reduction in net assets, but does
not involve a cash transaction.
Double-entry bookkeeping
A system under which transactions are
recorded as two entries, as a debit
(added value) to one account, and a
credit (re moved value) to another
account.
Float
A temporary cash balance maintained
to allow for differences in timing
between cash inflo w and cash outflow.
General ledger
A set of accounts.
Invoice
A statement that services have been
performed or goods delivered, and
requesting payment.
Journal entry
An entry within an account, such as a
credit or debit entry. (**check).
Ledger
An account, containing credit and debit
entries (**check).
Post a transaction
To create a transaction and add it to an
account.
Ra ise a transaction
To create a transaction and add it to an
account, or issue an invoice.
Ra ise funds
To borrow funds, or to source funds
fro m investors.
Receipt
A record acknowledging that payment
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