| Word | Meaning | Example |
|---|---|---|
| accounting | a system that provides quantitative information about finances | The American Accounting Association defines accounting as "the process of identifying, measuring and communicating economic information to permit informed judgments and decisions by users of the information." |
| transaction | a business deal or action, such as buying or selling something | While bookkeepers tend to focus on the details, recording transactions in an efficient and organized manner, they may or may not see the overall picture like accountants do, according to Certified Public Accountant Stan Snyder. |
| financial | relating to money or the management of money | "Accountants use the work done by bookkeepers to produce and analyze financial reports," Snyder said. |
| guideline | rules or instructions about the best way to do something | In order to present the information in a format everyone can understand, accountants follow a set of guidelines. |
| standard | a basis for comparison; a reference point against which other things can be evaluated | There are different sets of accounting standards for companies that operate overseas. |
| assumption | something that you think is true although you have no definite proof | "Some of the information will originate from the recorded transactions, but some of the information will be estimates and projections based on various assumptions," Averkamp said. |
| formula | a group of symbols that make a mathematical statement | To come up with a company's status and projections, accountants rely on various formulas. |
| ratio | the relation between things (or parts of things) with respect to their comparative quantity, magnitude, or degree | Accounting ratios help uncover conditions and trends that are difficult to find by inspecting individual components that make up the ratio. |
| inspect | look over carefully | The new rules have been enforced for inspecting restaurants. |
| divide | to separate into parts, sections, groups, or branches | Voters are deeply divided by race and age. |
| liquidity | being in cash or easily convertible to cash; debt paying ability | Europe outside Germany is wallowing in a liquidity trap, starved of cash in circulation. |
| arithmetic | the branch of pure mathematics dealing with the theory of numerical calculations | William earned 94% in arithmetic. |
| entry | the act of going into something | In his 1949 book, Luca Pacioli describes double-entry bookkeeping for the first time. |
| institute | a society or organization having a particular object or common factor, esp. a scientific, educational, or social one | She works for the Pennsylvania Institute of Certified Public Accountants. |
| audit | examine carefully for accuracy with the intent of verification | CPAs audit financial statements of public and private companies; serve as consultants in many areas, including tax, accounting, and financial planning; and are well-respected strategic business advisors and decision-makers. |
| planning | an act of formulating a program for a definite course of action | Good financial planning begins with thorough research. |
| advisor | an expert who gives advice | His financial advisors warned him against investing all of his savings in one company, but he did not listen to this advice. |
| career | the particular occupation for which you are trained | She began her career as a stock broker in 2008. |
| investment | the use of money to get a profit or to make a business activity successful, or the money that is used | There are countless jobs that require accounting proficiency, including auditors, financial investment analysts, claims adjusters, loan administrators, tax lawyers, underwriters and stockbrokers. |
| claim | a demand for something due or believed to be due or existing | The corporation made an insurance claim for ten million dollars. |
Exercise
Open the exercise to begin the activity. Follow the instructions in the document.