1.Financial Statement: Financial Statement are those statements which show the financial performance and financial position of the Business .It includes Trading A/C ,Profit & Loss A/C and Balance Sheet.
2.Trading Account: Trading A/C shows gross profit earned or gross loss incurred .it is created with sales ,other direct incomes and closing stock .It is debited by Direct Expenses i.e.Opening stock ,Net Purchases , Carriage inward Etc.
3.Profit & Loss A/C:Profit and loss A/C shows net profit earned or net loss incurred. It is credited with gross profit and other incomes and debited with Indirect Expenses .The difference between the totals of two sides is either net profit or net Loss.
4.Balance Sheet: Balance Sheet shows Financial Position of the Business .It is a Statement to which balances of assets , liabilities and capital accounts are showed at a Particular date.
5.Capital Expenditure: Capital Expenditure is that expenditure which gives benefit of enduring nature; i.e. the benefit of which extends to a period or periods beyond the accounting period.
6.Revenue Expenditure : Revenue Expenditure is that expenditure the benefit of which is Exhausted within the accounting period.
7.Deferred Revenue Expenditure: Deferred Revenue Expenditure is Expense or loss incurred by the firm which are written off in more than one accounting period .They are Categorised as fictitious Assets.
8.Capital receipts : Capital Receipts are those receipts which are not received in the normal course of business ,such as capital introduced ,loan received Etc.
9.Revenue Receipts : Revenue Receipts are those receipts which are received in the normal course of business ,such as revenue from sale of goods and services.
10.Contingent Liability : Contingent Liability is a Liability that becomes payable on the happening of an event and not otherwise.
11.Grouping : Grouping means placing items of one nature under a common head.
12.Marshalling :Marshalling is arranging the assets and liabilities in a Particular order ,i.e.,in order of liquidity or Permanence.
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