Accounting Terminology
The most frequently asked tax questions related to Accounting Terminology
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Answer Tax QuestionsIf I get work done on my house, can I use it as a tax deduction?
Asked Thursday, February 23, 2012 by an anonymous user
Improvements to your Residence are not deductible.
The costs are added to your initial cost basis to calculate your increased adjusted cost basis.
Your increased cost basis will be used in the year of sale of your residence to determine the gain on sale.
Improvements to your Rental property are deductible as a repair or a depreciable capital improvement.
The costs are added to your initial cost basis to calculate your increased adjusted cost basis.
Your increased cost basis will be used in the year of sale of your residence to determine the gain on sale.
Improvements to your Rental property are deductible as a repair or a depreciable capital improvement.
Accrual Basis Accounting
Asked Sunday, January 29, 2012 by an anonymous user
The method of keeping accounts which shows all expenses incurred and income earned for a given period of time, even though such expenses and income may not actually have been paid or received in cash during the same period of time.
Accounts Receivable
Asked Sunday, January 29, 2012 by an anonymous user
Amounts due the company on account from customers who have bought merchandise or received services. Accounts Receivable is a current asset on the Balance Sheet.
Accounts Payable
Asked Sunday, January 29, 2012 by an anonymous user
Obligations to pay for goods or services that have been acquired on open accounts from suppliers. Accounts Payable is a current liability in the Balance Sheet.
Balance Sheet
Asked Sunday, January 29, 2012 by an anonymous user
Statement, at a particular point in time, of the financial position of a business or organization. This is generally divided into three parts: assets, liabilities and ownership, or equity. Also known as Statement of Financial Position.
Retained Earnings (Accumulated Deficit)
Asked Sunday, January 29, 2012 by an anonymous user
Cumulative net incomes of a corporation less losses and dividend distributions to shareholders, profits not distributed is referred to Retained Earnings. If the accumulated earnings are exceeded by losses, then it is referred to as Accumulated Deficit. It is reflected in the equity section of the balance sheet.
Net Worth
Asked Sunday, January 29, 2012 by an anonymous user
The amount of asset value exceeding total liabilities.
Income Statement ( Statement of Profit and Loss)
Asked Sunday, January 29, 2012 by an anonymous user
A financial statement summarizing revenues, expenses, gains and losses for a stated period of time. The income statement is also known as a profit & loss statement, statement of earnings, statement of income and expenses or statement of operations.
Fiscal Year
Asked Sunday, January 29, 2012 by an anonymous user
A period of one year for which financial statements are prepared that may, or may not, coincide with the calendar year. Any twelve-month period used by a business as its accounting period.