Accounting Terms for Financial Business Literacy

What Is A Balance Sheet?

Running a business, even a small one, is already hard enough without throwing in statistical business reports in the mix. However, these reports are the key to achieving a successful venture. Whether you are an entrepreneur, an investor, or an executive, you need to understand financial statements, as they are the lifeline of your business …

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What Is A Trade Creditor?

It’s safe to assume that every business is a trade debtor and trade creditor at some point. In our previous article, we’ve discussed what a trade debtor is. To recap, it refers to businesses that are on the purchasing end of the deal. Trade debt is incurred when a company acquires products or services from …

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Why It’s a Great Time to Start a Business Now?

For us humans, we are well known to be innovators and creators of the natural world. With our mental capacity (and opposable thumbs), we have conquered the world and became the dominant species. As the years went on, we needed to develop our societies as well. Our ancestors did not just rely on living the …

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What Is A Trade Debtor?

“The bigger the business, the larger the debt.”   Do you agree with this? New businesses are established for many reasons, but the end goal is always the same: To generate income.   However, no matter how successful or influential your company may be, there’s one other thing you can never escape. It is what …

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What Is A Debtor?

As individuals, there are certain times when we encounter emergencies. When we think of this word, one of the few descriptive words that come to mind is “life-threatening”. From accidents to forces of nature, we may have encountered them in or another.    However, most of us will face emergencies of the financial kind. We …

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What Is Accrued Income?

Accounting is considered the backbone of a business. It is the record keeper of almost everything that matters to the company. There are so many ways that it can help the company to track down its progress.  From conception to an outcome, success or failure, movements in business are reported through accounting. It doesn’t just …

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What Is Prepayment?

Liabilities are legal obligations that entities must uphold. There are many kinds of financial commitments in business, and one of those is called the long-term liability. Paying these long-term liabilities in advance is what you refer to as prepayment. What is prepayment? However, before we discuss what prepayments are, it is important to understand what long-term liabilities …

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What Is The Difference Between Gain and Profit?

It is vital to get a firm understanding of all substantial terms in business, especially ones that involve your finances. One great example is the inaccurate interchangeable use of profit and gain in the industry. These two accounting terms both pertain to business earnings, but their similarities end there. It is time to create a …

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