Maharashtra HSC Accounting & Office Management (Vocational) key terms

A method of book-keeping in which every transaction is recorded twice, once as a debit and once as a credit, so that total debits always equal total credits.

The first written record of a transaction, showing the date, the accounts debited and credited, and a short narration explaining why the transaction took place.

A brief written description placed below a journal entry that explains the reason for the transaction in plain words.

A book or digital record that collects all entries affecting one particular account, showing debits on the left and credits on the right with a running balance.

A statement listing the closing balances of all ledger accounts on a given date, used to check that total debits equal total credits before final accounts are prepared.

A temporary account opened to hold the difference in a trial balance until the error causing the imbalance is traced and corrected.

The process of correcting mistakes found in the books, either by a journal entry before the trial balance is closed or by a corrected entry afterwards.

A statement prepared to explain the difference between the balance shown in the cash book and the balance shown in the bank passbook on the same date.

A book that records all cash and bank receipts and payments in date order, and which also serves as the cash account in the ledger.

A small cash book kept by a petty cashier to record minor day-to-day expenses, usually operated on the imprest system where a fixed float is replenished.

The systematic reduction in the book value of a fixed asset over its useful life, charged as an expense because of wear, tear, time or obsolescence.

An amount set aside from profit to cover debts that may not be recovered from customers, shown as a reduction from debtors in the balance sheet.

Amounts owed by customers that are confirmed as irrecoverable and are therefore written off as a loss in the profit and loss account.

The first part of the final accounts, which compares net sales with the cost of goods sold to arrive at gross profit or gross loss for the period.

A statement that records all indirect incomes and indirect expenses of a business to calculate the net profit or net loss for the accounting period.

A statement prepared on the last day of the accounting period showing the assets, liabilities and capital of a business and proving that both sides agree.

The owner's own money or assets invested in the business, increased by profit and additional investment and reduced by drawings and losses.

Money or goods taken out of the business by the proprietor for personal use, which reduces capital and is not treated as a business expense.

A business owned by two or more persons who share profits and losses as agreed, governed in India by the Indian Partnership Act, 1932.

A written agreement among partners that sets out the profit-sharing ratio, capital contributions, interest, salary and other terms of running the firm.

A qualified professional responsible for ensuring that a company complies with company law and for maintaining statutory registers, minutes and filings.

The official written record of decisions taken at a meeting of directors, signed by the chairman and kept as legal evidence of what was resolved.

A formal written intimation sent to every person entitled to attend a meeting, stating the date, time, place and business to be transacted.

The minimum number of members who must be present for a meeting to be validly held and for its decisions to be binding.

A register that a company is required by law to maintain, such as the register of members, directors or charges, kept open for inspection as prescribed.

An instruction typed into a cell, beginning with an equals sign, that calculates a value from other cells using operators, cell references or built-in functions.

The address of a cell such as A1 or B10, used in formulas to point to data; it may be relative, absolute or mixed depending on how it is written.

A computer program that records transactions, posts them to ledgers and generates reports such as trial balance and final accounts automatically.

An electronic code attached to a document that verifies the identity of the sender and confirms that the contents have not been altered.

A document such as a cheque, bill of exchange or promissory note that can be transferred from one person to another by delivery or endorsement.

A written order by a customer directing a bank to pay a stated sum from their account to a named person or bearer on demand.

The act of signing the back of a negotiable instrument to transfer the right to receive payment to another person.

Goods and Services Tax, an indirect tax levied in India on the supply of goods and services, collected at each stage with credit for tax already paid.

The credit a registered dealer can claim for GST already paid on purchases, which is set off against the GST payable on sales.

Written communication between a business and its customers, suppliers or authorities, including letters of enquiry, order, complaint and reply.

The standard layout of a business letter, comprising sender's address, date, receiver's address, subject, salutation, body, complimentary close and signature.

A business letter sent with the same content to many recipients at once, used to announce changes in address, price, policy or new products.

A written account of practical work undertaken by a student, describing the objective, method, data collected, analysis, findings and conclusions.

An oral examination in which a student answers questions from examiners about practical work or a project to demonstrate understanding.