Understanding Final Accounts: Key Concepts and Definitions

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Explore the essential key words related to final accounts such as Debtors, Creditors, Assets, Liabilities, Fixed Assets, Current Assets, Current Liabilities, Long-term Liabilities, Purchases, Sales, and Gains. These images provide a visual representation of the concepts to help you grasp the fundamentals of accounting easily.


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  1. Final accounts Key Words

  2. Debtors D for deadly People who owe us money

  3. Creditors Creditors C for Crap C for Crap People we owe money

  4. Assets A for awesome Things of value owned by a business

  5. Liabilities L for lousy Things we owe that must be repaid within one year such as bank overdraft and creditors

  6. Fixed Assets Long term items of value owned by the business e.g. land, buildings, motor vehicles, machinery

  7. Current Assets Items of value owned by the business that will be used up within a year such as : Stock Debtors Cash

  8. Current Liabilities Things we owe that we must pay within a year such as Bank overdraft Creditors

  9. Long term liabilities Things the business owes that will be repaid over a term longer than 5 years such as a long term loan also called a debenture

  10. Purchases Goods purchased for resale e.g. clothes bought to be resold

  11. Sales Revenue received from sale of goods that the company normally trades in e.g. clothes shop selling clothes is sales Clothes shop selling old table used to display clothes is not counted as sales as it does not normally trade tables

  12. Gains Revenue received by the business other than sale of goods normally traded e.g. rent receivable, interest receivable Hint in your trading profit and loss and appropriation, anything receivable is a gain

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