Terms starting with
Equitable Charge
An equitable charge is a claim on an asset that does not transfer ownership but grants the lender rights over the asset as security. In…
READ MOREExtended Trial Balance
An extended trial balance is a worksheet that expands the standard trial balance to include adjustment, income statement, and balance sheet columns. It is used…
READ MOREExpense Allocation
Expense allocation is the process of distributing shared or indirect costs across departments, projects, or cost centres. It ensures expenses are matched accurately to activities…
READ MOREExempt Income
Exempt income refers to earnings that are excluded from taxation under applicable laws. Examples may include certain government grants, tax-free interest, or specific allowances. Although…
READ MOREEscrow Account
An escrow account is a temporary holding account managed by a third party to secure funds during a transaction. In accounting, escrow balances are recorded…
READ MOREEquity Method of Accounting
The equity method is used when a company has significant influence over another entity, typically with ownership between 20% and 50%. The investor recognises its…
READ MOREEffective Interest Rate
The effective interest rate represents the actual cost of borrowing or return on investment after considering compounding and related fees. It provides a more accurate…
READ MOREEarnings Quality
Earnings quality refers to how sustainable, reliable, and repeatable a company’s profits are. High-quality earnings come from core operations rather than one-time gains, accounting adjustments,…
READ MOREEarly Payment Discount
An early payment discount is a reduction offered to customers who settle invoices before the due date. Commonly expressed as terms like 2/10, net 30,…
READ MOREEncashment
Encashment involves converting negotiable instruments like cheques, bills, or bonds into cash. In accounting, it represents the realisation of funds and affects liquidity and cash…
READ MOREEstimated Useful Life
Estimated useful life refers to the anticipated period an asset will remain productive and contribute to revenue generation before becoming obsolete or inefficient. It forms…
READ MOREErrors and Omissions
Errors and omissions refer to unintentional mistakes or oversights in accounting records, such as misclassifications, arithmetic errors, or missing transactions. These inaccuracies can distort financial…
READ MOREEndowment Fund
An endowment fund consists of donations or capital set aside to generate ongoing income for a specific purpose commonly used by educational, religious, or non-profit…
READ MOREEntity Concept
The entity concept states that a business must be treated as a separate economic unit from its owners or stakeholders. Personal and business transactions are…
READ MOREEconomic Value Added (EVA)
Economic Value Added measures how much value a business generates beyond the cost of its capital. It is calculated as net operating profit after taxes…
READ MOREEstimated Liability
An estimated liability is a known obligation whose exact value cannot yet be determined. Businesses record these based on reasonable forecasts, such as warranties, bonuses,…
READ MOREEncumbrance
An encumbrance represents a claim or liability against an asset, such as mortgage, lien, or legal restriction, that may affect the owners ability to transfer…
READ MOREExtraordinary Expense
Extraordinary expense is a non-recurring, unusual cost outside normal business operations, such as lawsuit settlements, disaster losses, or restructuring costs. These are reported separately in…
READ MOREExtraordinary Depreciation
An unexpected, accelerated reduction in asset value due to unusual events like a natural disaster, accident, or sudden obsolescence. It’s treated separately from regular depreciation…
READ MOREExpenditure
The total amount spent by a business to acquire assets, goods, or services. It includes both capital expenditures (long-term investments) and operating expenses (day-to-day costs).…
READ MOREExchange Gain/Loss
The profit or loss from converting one currency to another due to exchange rate fluctuations. These arise in international transactions and impact income statements. Gains…
READ MOREEmployee Liabilities
Amounts owed by a company to its employees or on their behalf. This includes unpaid wages, accrued vacation, payroll taxes, and pension contributions. These are…
READ MOREEarnings Statement
Earning statement is also known as the income statement or profit and loss statement. It summarizes a company’s revenues, expenses, and profits over a specific…
READ MOREEarnings Per Share
A key profitability metric showing how much net income is earned per outstanding share of common stock. It’s calculated as net income minus preferred dividends,…
READ MOREEarned Surplus
Another term for retained earnings the portion of net profits that is not distributed as dividends but kept within the company to reinvest or pay…
READ MOREEarned Income
Income received through active work or services, like salaries, wages, commissions, or business profits. It contrasts with passive income (like interest or dividends). For tax…
READ MOREExpenses
Expense is a costs incurred by a business to generate revenue. These include rent, salaries, utilities, and materials. Expenses are recorded on the income statement…
READ MOREExternal stakeholders
Individuals or groups outside the business who have an interest in its performance or decisions. These include investors, customers, suppliers, lenders, regulators, and the public.…
READ MOREEquity
Equity represents the residual interest in a company’s assets after deducting liabilities. For owners, it reflects their stake in the business. In corporations, it includes…
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