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Accounting terms cheat sheet: +20 concepts defined in plain language. system used to record more than just financial transactions. Done right, accounting. tracks and analyzes business transactions in total, (2) measures and improves the health of a business, as well as (3) reports financial results to investors, creditors, and regulators.
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My accounting dictionary is written completely in everyday, non-accounting language, so you can understand it. I also explain each accounting term in detail and give examples of each, so you can understand the concepts behind the jargon.
How To Find Accounting Definitions. Our layout is designed to facilitate easy navigation, allowing you to either browse through the alphabetically organized terms or quickly pinpoint specific accounting definitions using the search functionality at the top of the page.
- The Basics of PPE and Depreciation
- Where to Find Depreciation / PPE in A 10-K
- Example of PPE: Data Centers
- Investor Takeaway
PPE is also known as a fixed, or tangible, asset. It must have two features: 1. A useful life of more than 1 year 2. A value that depreciates over time These are real expenses that the company pays, but it’s tricky because the expenses are accounted for over multiple years rather than just 1 (like a regular expense). That’s where the depreciation c...
Let’s take two examples of big businesses in the S&P 500 that have very different business structures but the same end market. This should give us a good representation on either end of PPE light or PPE heavy balance sheets, for illustrations of different capex requirements, depreciation, and general PPE accounting. I want to look at Walmart ($WMT)...
Take Facebook as an example of a tech company that has been scaling up their PPE investments. Back in 2011, Facebook built its first in-house data center. Today, it has announced a new $1B facility in Singapore (1.8 million square foot), and had 6 “cloud” campuses as recently as 2019, and continues to grow its network and its business (and subsidia...
Amazon (AWS)Microsoft (Azure)Google (Google Cloud)Step 1: Identify the significant components of a PP&E item. To apply the component approach, it is necessary to identify the significant parts of an asset. IAS 16 specifies two different types of components: (1) a physical component and (2) a non-physical component that represents a major inspection or overhaul.
Interested in accounting, but you keep seeing terms unfamiliar to you? This A-to-Z glossary defines key accounting terms you need to know. Accountants possess a wide range of skills critical for financial management and reporting.
Jun 1, 2023 · Explore 50 accounting terms, definitions, and explanations tailored for you. Enhance your financial literacy and make informed decisions.
