Account: A summarized Record of all the transaction relating to particular person, thing or service which has taken place during the given period of time.

Liabilities: liabilities mean debts or amount due from a business to others either for money borrowed or goods or Asset purchased on credit.

Ex: long term liabilities, (term loan) short term liabilities (accounts payables).

Asset: Asset refers to properties or things owned by a business. Debtors, A/R

Creditor: A creditor is a person to whom the business owes money.

Debtor: A debtor is a person who owes money to the business

Debit: It means the benefit Received by account.

Credit: It means the benefit paid by account.

Ledger: A ledger is an account book in which all the accounts are maintained.

Trial Balance: A trial balance is a list of all the ledger balance.

Profit and loss account:

The profit and loss account ia an account which shows the Net profit or net loss of a business for a particular trading period.

Balance sheet: the statement of asset and liabilities prepared on the last date of the trading period know as the balance Sheet

Prepaid Expenses: paid during the current period relates to next period.

Per paid expenses account Dr

To Expenses account Cr

Outstanding Expanses account: Expanses which have been incurred during the particular trading period

but not paid by the closing date of the period

Expenses account Dr

To outstanding expanses account Cr

Name of account Type of account ReasonFurniture account Real account Account of an assetSalaries account Nominal account Account of an ExpenseCapital account Personal account Account of a personPurchase account Real account Account of goodsCash account Real account Account of assetBank account Personal account Account of a personSales account Real account Account of a goodsAccount Receivable Real account Account of assetAccount payable Real account Account of assetRent account Nominal account Account of expensePostage account Nominal account Account of expense