Balance The difference in dollars between the total debit footing and the total credit footing of an account. Also called account balance.






Chart of accounts "A scheme that assigns a unique number to each account to facilitate finding the account in the ledger; also, the list of account numbers and titles."

Classification The process of assigning transactions to the appropriate accounts.

Compound entry An entry that has more than one debit or credit entry.

Cost The exchange price associated with a business transaction at the point of recognition.

Cost principle The practice of recording transactions at cost.

Credit The right side of an account.






Debit The left side of an account.

Double-entry system "The accounting system in which each transaction is recorded with at least one debit and one credit, so that the total dollar amount of debits and the total dollar amount of credits equal each other."






Footings Working totals of columns of numbers. To foot means to total a column of numbers.






General journal The simplest and most flexible type of journal.

General ledger "The book or file that contains all of the company’s accounts, arranged in the order of the chart of accounts. Also called ledger."






Journal A chronological record of all transactions; the place where transactions first enter the accounting records. Also called book of original entry.

Journal entry Journal notations that record a single transaction.

Journal form "A form of journal in which the date, the debit account, and the debit amount of a transaction are recorded on one line and the credit account and credit amount on the next line."

Journalizing The process of recording transactions in a journal.






Ledger account form "The form of account that has four dollar amount columns: one column for debit entries, one column for credit entries, and two columns (debit and credit) for showing the balance of the account."






Normal balance The usual balance of an account; also the side (debit or credit) that increases the account.






Posting The process of transferring journal entry information from the journal to the ledger.






Recognition The determination of when a business transaction should be recorded.

Recognition point "The predetermined time at which a transaction should be recorded; usually, the point at which title passes to the buyer."






Source document "An invoice, check, receipt, or other document that supports a transaction."






T account "The simplest form of an account, used to analyze transactions."

Trial balance A comparison of the total of debit and credit balances in the accounts to check that they are equal.






Valuation The process of assigning a monetary value to a business transaction.