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TLE 10 Accounting Elements

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57 views4 pages

TLE 10 Accounting Elements

Uploaded by

nbpamistoso
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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TECHNOLOGY AND LIVELIHOOD EDUCATION 10

BOOKKEEPING
This is the recording of business transactions in a systematic manner. This is the
recording phase of accounting and the primary basis of financial statements.

ACCOUNTING ELEMENTS

ASSETS
Everything the company owns and uses to conduct business.

LIABILITIES
Everything the company owes to another entity to conduct business.

OWNER’S EQUITY (The business is a separate entity from the owner) The
amount of the business owned by the business owners.

• REVENUE
The amount of money a company receives during business activities (sale of
goods, provision of services, or professional services.

• EXPENSES
Money spent by an organization’s efforts to generate income.

BASIC ACCOUNTING EQUATION

ASSETS = LIABILITIES + OWNER’S EQUITY

ACCOUNT TITLES
Account titles are used in keeping record of transactions the business incurs. Each
account title belongs to an accounting element.

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Account Title Definition
Cash Currency, checks, postal money orders
Accounts Receivable Amounts collectible from customers or clients

Notes Receivable Amounts collectible that are covered by promissory


notes
Land Land acquired by the business for its use
Prepaid Expenses Expenses to be incurred in the future but are
already paid
Loans Payable Obligations arising from loans obtained
Office Equipment Heavy metallic and movable items in an office that
are capable of performing certain functions

Building Structures acquired for use by the business


Taxes and Licenses Taxes and cost of permits incurred
Electricity and Water Cost of power and water consumed
Rent Expense Rentals incurred based in occupancy of space or
usage of property and equipment
Miscellaneous Expenses Different minor expenses incurred
Capital Accumulated capital of the owner of the business

Notes Payable Obligations covered by promissory notes


Drawing Used for withdrawals made by the owner
Tools Handy, small, and usually metallic items
used in performing certain functions

Accounts Payable Obligations to suppliers for items bought and not


supported by promissory notes
Advertising Expenses Incurred in making the public aware of the goods
and services being offered by the business

Fees Income Revenue realized by providing


professional services to clients
Salaries and Wages Compensation earned by employees for services
rendered by them to the firm
Equipment Heavy, metallic, and movable items that are
capable of performing certain functions

Furniture and Fixtures Movable items of significant value and acquired to


improve the workable
condition of a place
Accrued Expenses/Expenses Payable Obligations for expenses already incurred but not
yet paid
Service Income Revenue realized by providing services to clients

Sales Revenue from sale of goods

Identify the Accounting Element the Account Title belongs to.

Account Accountin Account Accountin Account Accountin

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Title g Element Title g Element Title g Element
Cash Notes Sales
Receivabl
e
Accounts Accounts Service
Receivable Payable Income

Land Notes Fees Income


Payable
Building Loans Taxes and
Payable Licenses
Office Capital Advertising
Equipment Expense
Equipment Drawing Salaries and
Wages
Furniture Rent Electricity
and Expense and
Fixtures Water

Miscellaneo
us Expense

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