Liabilities that record the obligation to make payments for the expenses that have been incurred or for the assets that have been acquired but for which payment has not yet been made. In other words, payment is due, but has not yet been made.

Expenses recognized prior to the payment of cash. For example, entering a bill into your accounting software, but not paying it at the same time.

The process of recording, summarizing, and reporting accounting information.

A depreciation method that allocates an equal amount of the cost of a plant asset to expense during each fiscal period of the asset’s expected useful life.

A contra-asset account used to identify the total amount of depreciation recorded for the company’s assets.

A depreciation method that allocates a larger portion of the cost of a plant asset to the expense early in the asset’s life.

The allocation of the cost of assets to the fiscal periods that benefit from the asset’s use.

Accounts that record financial data about individual items of importance to a company, such as transactions for individual customers, suppliers or products.

An account that offsets another account. For example, a depreciation account that offsets an asset.

A liability account that identifies an obligation to pay suppliers in the near future.