Basic/General Accounting

Items

• gross profit

  The business’s profits after subtracting the cost of goods sold from the total revenue.
• gross salary

  The total amount of money an employee receives before deductions and taxes.
• hire purchase

  Hire purchase (HP) or leasing is a type of asset finance that allows firms or individuals to possess and control an asset during an agreed term, while paying rent or instalments covering depreciation of the asset and interest to cover capital cost.
• historical cost

  The price paid for an asset when it was purchased.
• honorarium

  Is a voluntary payment that is given to a person for services for which fees are not legally required.
• households

  A group of people, often a family, who live together.
• human resources

  The division of a business that manages the employee life cycle and is responsible for recruiting, screening, training employees and performance management.
• income

  Earned from services rendered or sales (inflow of money).
• income earned

  Money that you receive for your work or business activities.
• income received in advance

  Unearned income, is money that you receive for goods and services that you have not yet delivered.
• statement of profit or loss

  Previously known as an income statement, financial statement that summarises a company’s revenue and expenses over a period of time.
• income tax

  Tax that governments impose on the income of a business.
• increase

  Becoming greater or more in amount.
• indirect labour

  Labour that is not directly involved in the production of goods and services.
• indirect material

  Material that is used in the production process, but is not directly incorporated into the final product.
• inducement

  Anything that is offered or given to someone to persuade them to do something. Typically refers to a benefit or incentive offered to influence a particular financial decision or action.
• Input VAT

  Input VAT is the value-added tax (VAT) that a business pays on the goods and services that it purchases.
• insolvency

  Insolvency is a state of financial distress in which a business or person is unable to pay their debts.
• insufficient funds

  A banking term that describes an account that does not have enough money to cover a transaction.
• instalment sales

  Instalments sales are sales of goods or services where the buyer agrees to pay the seller in instalments over a period of time.
• intermediaries

  Businesses or individuals that act as a middleman between buyers and sellers.
• interest

  The cost of borrowing money.
• interest on capital

  The interest that a business owner or partner receives on the capital that they have invested in the business.
• interest on current account

  Amount of money that bank pays you for keeping money in your current account.
• interest on receivables

  Amount of interest earned but not yet received.