Accounting vocabulary in English (P1) – Những từ vựng tiếng Anh quan trọng về Kế toán (P1)

In accounting, there are many important terms and concepts that you should be familiar with in order to understand financial statements and other accounting documents. Here are some common accounting terms and their definitions:

  • Asset: A resource that is owned by a business, such as cash, investments, or property.
  • Liability: A debt or obligation owed by a business, such as a loan or credit card balance.
  • Revenue: The money a business earns from selling goods or services.
  • Expense: The money a business spends in order to operate, such as rent or payroll.
  • Net income: The amount of money a business earns after subtracting expenses from revenue.
  • Profit: The money a business earns after accounting for all costs and expenses.
  • Loss: When expenses exceed revenue, resulting in a negative net income.
  • Equity: The value of a business’s assets minus its liabilities.
  • Balance sheet: A financial statement that shows a business’s assets, liabilities, and equity at a specific point in time.
  • Income statement: A financial statement that shows a business’s revenues, expenses, and net income over a specific period of time.
  • Cash flow statement: A financial statement that shows the flow of cash into and out of a business over a specific period of time.
  • Accounting period: The time frame used to prepare financial statements, such as a month, quarter, or year.
  • Accrual basis of accounting: An accounting method that records revenue and expenses when they are earned or incurred, rather than when they are paid.
  • Adjusting entries: Journal entries made at the end of an accounting period to update the accounts to reflect the current financial position of the business.
  • Depreciation: The allocation of the cost of a long-term asset, such as a building or machinery, over its useful life.
  • Amortization: The allocation of the cost of an intangible asset, such as a patent or trademark, over its useful life.
  • Cash basis of accounting: An accounting method that records revenue and expenses when they are received or paid, rather than when they are earned or incurred.
  • Contingent liability: A potential liability that may arise depending on the outcome of a future event, such as a lawsuit.
  • Double-entry accounting: An accounting method in which every transaction is recorded in at least two accounts, with one account being debited and the other being credited.
  • GAAP (Generally Accepted Accounting Principles): The standard set of rules and guidelines for financial reporting in the United States.
  • Trial balance: A report that lists the balances of all accounts in a company’s chart of accounts at a specific point in time.
  • Chart of accounts: A list of all the accounts used by a business, organized by account type and number.
  • General ledger: A complete record of all the transactions that a business has made, including the date, amount, and description of each transaction.
  • Journal entry: A record of a financial transaction in the general ledger, including the accounts affected, the amounts debited and credited, and a description of the transaction.
  • Credit: An entry on the right-hand side of an account, representing an increase in assets or a decrease in liabilities.
  • Debit: An entry on the left-hand side of an account, representing an increase in liabilities or a decrease in assets.
  • Net worth: The total value of a business’s assets minus its liabilities, also known as equity.
  • Audit: A formal examination of a company’s financial records by an independent auditor to verify their accuracy and compliance with relevant laws and regulations.
  • Cost of goods sold: The direct costs associated with producing the goods or services that a business sells, such as materials, labor, and overhead.
  • Operating expenses: The costs of running a business, such as rent, utilities, and administrative salaries.
  • Break-even point: The point at which a business’s revenues equal its expenses, resulting in neither profit nor loss.
  • Accrual: The process of recognizing revenue and expenses when they are earned or incurred, rather than when they are paid or received.
  • Accrued expense: An expense that has been incurred but not yet paid, such as an unpaid utility bill.
  • Accrued revenue: Revenue that has been earned but not yet received, such as an unpaid invoice.
  • Closing entries: Journal entries made at the end of an accounting period to transfer the balances of temporary accounts, such as revenue and expense accounts, to the permanent accounts, such as equity or retained earnings.
  • Closing the books: The process of making the closing entries at the end of an accounting period.
  • Financial statement: A document that shows a company’s financial position, performance, or cash flows at a specific point in time or over a specific period of time.
  • Footing: The process of totaling the debits and credits in an account to check for accuracy and make sure the account is in balance.
  • Net sales: The total amount of sales made by a business, minus any sales returns, discounts, or allowances.
  • Posting: The process of transferring journal entries to the appropriate accounts in the general ledger.
  • Subsidiary ledger: A ledger that contains detailed information about a specific account, such as accounts receivable or accounts payable.

I hope this helps you understand some of the key concepts and terms used in accounting. As you can see, there is a lot to learn in this field, but having a strong foundation in the basic principles and vocabulary can be very helpful in understanding financial statements and other accounting documents.

Here are a few more accounting terms that you might find helpful:

  • Auditing: The process of examining a company’s financial records and practices to ensure they are accurate, transparent, and compliant with relevant laws and regulations.
  • Bank reconciliation: The process of comparing a company’s bank statement with its own records to identify and resolve any discrepancies.
  • Capital expenditure: Money spent on long-term assets, such as property or equipment, that are expected to provide value to a business for several years.
  • Cash equivalent: An asset that can be easily converted into cash, such as a short-term investment or a marketable security.
  • Debt to equity ratio: A measure of a company’s financial leverage, calculated by dividing its total liabilities by its total equity.
  • Deferred revenue: Revenue that has been received in advance but not yet earned, such as a prepayment for a subscription service.
  • Depletion: The process of allocating the cost of a natural resource, such as timber or oil, over its estimated useful life.
  • Financial leverage: The use of borrowed money to finance a business’s operations or investments.
  • Internal control: A system of policies, procedures, and processes designed to ensure the accuracy, reliability, and integrity of a company’s financial information.
  • Ratio analysis: The use of financial ratios to compare a company’s performance to industry benchmarks or to its own historical performance.
  • Accumulated depreciation: The total amount of depreciation that has been recorded for a long-term asset over its useful life.
  • Allowance for doubtful accounts: A contra-asset account that represents the estimated value of accounts receivable that may not be collected.
  • Bad debt expense: The amount of money a business writes off as a loss when it is unable to collect payment from a customer.
  • Cash flow from operating activities: The net cash generated or used by a company’s ongoing business operations, as reported on the cash flow statement.
  • Current asset: An asset that is expected to be converted into cash or consumed within one year or the company’s operating cycle, whichever is longer.
  • Current liability: A liability that is expected to be paid within one year or the company’s operating cycle, whichever is longer.
  • Dividend: A distribution of a company’s profits to its shareholders.
  • Financial ratio: A comparison of two or more financial measures, used to evaluate a company’s performance or financial position.
  • Fixed asset: A long-term asset that is not intended for sale, such as property or equipment.
  • Goodwill: The excess value of a company over the fair value of its assets and liabilities, often resulting from a merger or acquisition.
  • Inventory: The raw materials, work-in-progress, and finished goods that a business has on hand for sale.
  • Long-term liability: A liability that is not expected to be paid within one year or the company’s operating cycle, whichever is longer.
  • Management’s discussion and analysis (MD&A): A section of a company’s annual report that provides management’s perspective on the company’s financial performance and condition.
  • Net cash provided by (used in) operating activities: The net amount of cash generated or used by a company’s ongoing business operations, as reported on the cash flow statement.
  • Net present value (NPV): The present value of a series of future cash flows, discounted at a specified interest rate.
  • Operating cycle: The time it takes for a company to purchase raw materials, convert them into finished goods, and sell the finished goods to customers.
  • Payroll tax: A tax that is withheld from an employee’s pay and paid by the employer to the government, such as Social Security and Medicare taxes.
  • Product cost: The direct costs associated with producing a product, such as materials and labor.
  • Retained earnings: The portion of a company’s net income that is not distributed to shareholders as dividends, but is instead retained by the company for future use.
  • Accumulated amortization: The total amount of amortization that has been recorded for an intangible asset over its useful life.
  • Amortization schedule: A table showing the amount of amortization to be recognized each period for an intangible asset.
  • Book value: The value of an asset as shown on a company’s balance sheet, calculated by subtracting accumulated depreciation from the asset’s cost.
  • Capital budget: A plan for a company’s long-term investments, including the expected costs, benefits, and risks of each investment.
  • Capital expenditure budget: A budget that specifies the amount of money a company plans to spend on long-term assets in the coming year.
  • Cash budget: A budget that specifies the amount of cash a company expects to receive and spend in the coming year.
  • Current ratio: A measure of a company’s ability to pay its short-term debts, calculated by dividing its current assets by its current liabilities.
  • Depletion schedule: A table showing the amount of depletion to be recognized each period for a natural resource.
  • Financial plan: A long-term plan for a company’s financial management, including its capital budget, cash budget, and other financial projections.
  • Net cash provided by (used in) investing activities: The net amount of cash generated or used by a company’s investing activities, as reported on the cash flow statement.
  • Net cash provided by (used in) financing activities: The net amount of cash generated or used by a company’s financing activities, as reported on the cash flow statement.
  • Net cash provided by (used in) operating, investing, and financing activities: The net amount of cash generated or used by a company’s ongoing business operations, investing activities, and financing activities, as reported on the cash flow statement.
  • Receivables turnover ratio: A measure of a company’s efficiency in collecting its accounts receivable, calculated by dividing its net credit sales by its average accounts receivable.
  • Return on assets (ROA): A measure of a company’s profitability, calculated by dividing its net income by its total assets.
  • Return on equity (ROE): A measure of a company’s profitability, calculated by dividing its net income by its shareholders’ equity.
  • Statement of cash flows: A financial statement that shows the sources and uses of a company’s cash during a specific period of time.
  • Tax rate: The percentage of a company’s income that it must pay in taxes.
  • Total assets: The sum of a company’s current assets and long-term assets, as shown on its balance sheet.
  • Total liabilities: The sum of a company’s current liabilities and long-term liabilities, as shown on its balance sheet.

These are just a few of the many important terms you should be familiar with in order to understand accounting principles and practices. I hope this helps!

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