Giving examples, explain each of the following accounting terms:
- Fixed assets
- Short-term liabilities
Fixed assets: Fixed Assets refer to those assets which are held for continued use in the business to produce goods and services and not meant for resale.
- Land and Building
- Plant and Machinery,
- Office furniture,
- Vehicles such as company trucks.
Revenue: Revenues refer to the amount received from the day-to-day activities of the business entity.
- Commission received,
- Interest revenue
- Repairs and maintenance,
- profit on the sale of fixed assets,
- appreciation in the value of an asset,
- profit on the sale of an investment.
- Goods sold above its cost.
Capital: The capital means the assets and cash in a business, It refers to the amount invested by the owner of a firm. It may be in form of cash or asset.
- receivable accounts,
- property, or houses.
Short-term liabilities: Short-term liabilities are the liabilities that are incurred to be paid or are payable within a year.
- Bank overdraft creditors,
- Bills payable,
- Outstanding wages,
- Short-term loans.