Resolved Question
Can anyone define: assets, liabilities, expenses and capital?
in simple english please. tried googling, but don't really understand some of the definitions, and would also like to hear what other people think. thanks!
Best Answer - Chosen by Asker
Assets relate to all property, goods, staff, stock etc held by a company. They have a monetary value, either the cost paid, wage paid or resale value.
Liabilities include money you owe, tax you have to pay
Expenses include all items not already covered under Assets. These might be travel/petrol costs, meals, expenses claimed by staff
Capital is the amount of money invested into a company, ie share capital, It also covers savings, this is not related to cash flow in any way.
Cash flow is the amount of money you have coming into your company, the money that can be drawn upon to pay your staff or creditors, when purchasing stock, you increase you assets, when paying staff you increase your assets
Hope this helps, I am not an expert and accountancy is like some weird other world to me, but I run my own company so I have had to glean some knowledge.
Liabilities include money you owe, tax you have to pay
Expenses include all items not already covered under Assets. These might be travel/petrol costs, meals, expenses claimed by staff
Capital is the amount of money invested into a company, ie share capital, It also covers savings, this is not related to cash flow in any way.
Cash flow is the amount of money you have coming into your company, the money that can be drawn upon to pay your staff or creditors, when purchasing stock, you increase you assets, when paying staff you increase your assets
Hope this helps, I am not an expert and accountancy is like some weird other world to me, but I run my own company so I have had to glean some knowledge.
There are currently no comments for this question.
Other Answers (0)
No other answers.
No comments:
Post a Comment