Account Current. A running record of current financial transactions between two parties who may, through the growth of their account, become debtor or creditor alternately.

Account Sales. A statement giving an accounting of goods sold, rendered by a consignee to the consignor.

Account Receivable. An account showing a debit balance to be presently received in cash or its equivalent.

Account Payable. An account showing a credit balance to be presently paid in cash or its equivalent.

Accountability. That relation which exists between two parties by virtue of which one is required to account to the other for money or property.

Accountancy is a profession having to do with the recording, verification and presentation of facts involving the acquisition, production, conservation and transfer of values.

Accountant. One skilled in the science of accounting.

Accounting. Accounting is the science which treats of the systematic record, compilation and presentation in a comprehensive manner of the financial operations of a business.

Accrual. (1) The act of accruing. (2) That portion of an accruing account not yet due applicable to the accounts of the period under consideration.

Accrue. (1) To accumulate automatically through lapse of time. (2) To set up or record a debit or credit automatically accumulating through lapse of time.

Accrued interest receivable or payable is the amount of accruals of interest on various classes of assets or liabilities.

Accrued taxes is the amount of accruals of taxes.

Accrued dividends (or accumulated dividend) is the amount of accruals of dividends receivable or payable on guaranteed or cumulative stocks owned, issued or guaranteed.

Active Account. An account in which the entries are frequent; as distinguished from an "inactive" account.

Active Partner. A partner who is subject to full partnership liability as distinguished from a "silent" or "special" partner, whose liability is limited.

Additional Capital. New capital; i. e., an amount supplied as capital increasing that previously provided. The term "additional capital" refers to the amount coming into the

business as distinguished from the expenditures made in increasing capital investments. (See Additions to Capital.)

Additions to Capital. (A contraction of "additions to capital investments.") Expenditures for capital account; "capital expenditure." The amounts expended for additional capital assets, such as structures, machinery or permanent equipment.

Adjustment Account. A temporary account set up to show a record of the items of a transaction or series of transactions subject to and pending its clearance by definite classification or by adjustment between the respective interests therein.

Adjustment Mortgage Bonds. Mortgage bonds issued under a modification of the terms of a previous issue, the conditions of which the debtors have been unable to fulfill.

Administration Expenses. Expenses incurred in connection with the administration of a business, usually the salary and expenses of the executives and other expenses not directly chargeable to specific operating or selling expenses.

Administrator. A person named by the probate court, or other proper authority, to take charge of the property and administer the estate of one dying without leaving a will or an estate for which no competent executor is named in the will.

Advance Bill. A commercial "bill of exchange" drawn against goods subsequently to be shipped instead of against a shipment already made.

Advertising Expense. The expense of attracting the attention of the public to a business, product, proposition or fact.

Affiliated Company (or Corporation.) A company (or corporation) related to another through stock or bond ownership, operating agreement or other mutuality of interest.

Agency. (a) The relationship between principal and agent. (b) The place of business of an agent.

Agent. A person duly authorized to act on behalf of another, or one whose unauthorized act has been duly ratified.

Allocate. (a) To assign items to their appropriate captions in a classification of accounts. (b) To classify.

Allonge. A slip of paper attached to a negotiable instrument to receive endorsement for which there is no space on the instrument itself.

Allowance. (1) A concession or abatement. Specifically in accounting usage, a concession made to customers because of faults existing or claimed in goods or service. (2) A definite amount granted or determined upon for a specific purpose; as an allowance for depreciation, an allowance in lieu of actual expenses, etc.

Amortization. The gradual extinguishment of the amount of an asset, liability, profit or loss by pro-rating it over the period during which it will exist or during which its benefit will be realized. Specifically, (1) The gradual extinction of a debt, as, for instance, by means of a sinking fund. (2) The gradual reduction in the valuation of an asset, thus anticipating the time when it shall eventually become worthless; as distinguished from provision for depreciation or replacements because of physical loss or damage. (3) The absorption in the Income or Profit and Loss accounts, during the pendency of the debt, of a discount incurred or of a premium realized in the sale of an obligation, which discount or premium may be carried in the meantime in a debit or in a credit Suspense account.

Annuity. A fixed sum of money granted or bequeathed, payable yearly or at certain regular periods.

Appraisal. The result of a valuation of property or other assets, used mostly in connection with the valuation of fixed assets of a corporation.

Appreciation. Increase in value through improvement in condition or market value, applied in respect of real estate, plant, machinery, securities, etc.

Assigned Accounts. Accounts originally due to one person who has by agreement made them payable to some other person, usually his creditor.

Auditor. An accountant who examines, criticizes and passes upon the accuracy of accounts.

Balance Sheet. A statement showing the financial condition of a business at a specific date.

Balance Sheet Audit. A verification of the assets and liabilities and a sufficiently exhaustive analysis of the Profit and Loss accounts enabling the auditor to certify that the surplus appearing in the Balance Sheet is reasonably correct.

Bank of Discount. A bank authorized by law to lend money on personal notes. The term bank, as used here, means any moneyed corporation authorized by law to issue bills, notes, or other evidences of debt for circulation as money, or to receive deposits of money and commercial paper and to make loans

thereon, and to discount bills, notes, or other commercial paper and to buy and sell gold and silver bullion or foreign coins or bills of exchange. (N. Y. State Banking Law.)

Book Inventory. A record of all goods put into and taken out of stock, and the balance remaining on hand. It always shows quantities and must also show values if the cost records are articulated with the general books.

Budget. A statement of the estimated revenues and expenditures for a given future period.

Capital. This term as used in accounting is employed to express the sum of the net assets, or the sum which remains after deducting the total liabilities from the total assets of a business or undertaking.

Any principal sum (usually in cash, sometimes in property) contributed to an undertaking by a partner or other individual for supplying the means to operate such undertaking.

The value or amount any individual has invested in an undertaking.

Any principal sum which is used or retained to produce income or profit.

Capital Assets. Includes real estate, buildings, and other structures, equipment and other personal property of a more or less permanent character, and cash on hand specifically applicable to these assets.

Capital Expenditures. All sums expended for addition to, or improvement of, properties.

Capital Liabilities. Liabilities incurred in the acquisition of capital assets.

Capital Receipts. Cash received from stockholders in a corporation in payment of their subscriptions to the capital stock.

Capital Stock. The amount of share capital (issued or authorized) of a company or corporation.

Cash. Lawful money. Usually understood to include cash items and such other instruments as are received by banks for deposit.

Cash Disbursements. Cash payments made during a stated period regardless of the purpose of the payment.

Cash Journal. A book of original entry in which both cash and non-cash entries are recorded. Columns are provided for cash receipts, cash payments, and for accounts most frequently debited and credited. Sundry debit and credit columns are also provided.

Cash Receipts. Cash received during a stated period regardless of the purpose for which received.

Chattel Mortgage. A lien upon personal property, given by the owner as security for the payment of a debt or the performance of some other obligation. Upon default, such lien may be perfected into an absolute title by foreclosure and sale.

Closing Entries. Entries made upon the books of account at the end of a fiscal period for the purpose of closing the nominal accounts.

Consignment Accounts. Those accounts which cover the consignment of goods to an agent or consignee.

Consolidated Balance Sheet. A Balance Sheet which exhibits the combined financial condition of a number of business organizations.

Construction Account. An account employed to show the cost of construction of a piece of property. It is usually made to contain all items, such as material, labor, expense, entering in the work; in some cases interest on borrowed money is charged against this account and even the discount on the sale of bonds issued for the work.

Contingent Fund. Money set aside to be drawn upon only in case of certain emergencies.

Contingent Liability. An amount which may become due usually through the default or action of a third party.

Controlling Account. An account kept in the general ledger which represents in one account the sum of all the transactions, and of all the balances of a group of accounts in a subsidiary ledger, or other record such as a voucher payable record.

Costs Incurred. All expenditures, whether paid in cash or not, for which a business has become liable.

Current Assets. Those assets which can be readily converted into cash.

Current Liabilities. Amounts owed subject to constant change, such as accounts payable to creditors, becoming due and payable in short periods.