Financial Accounting Directory
A complete A–Z glossary of financial accounting terms for commerce students — from basic journal entries and ledgers to final account adjustments, depreciation, and error rectification. Built for Class 11/12, B.Com, and professional course (CA, CS, CMA) learners.
Browse alphabetically using the Jump to Letter bar above, or scroll through the full A–Z list to revise systematically. Each term will link to a complete explanation with definitions, formulas, journal entries, and solved examples where applicable. Use this directory as a quick-reference hub while studying for school exams, B.Com papers, or professional courses like CA, CS, and CMA — all of which build on these foundational financial accounting concepts. Bookmark this page and revisit it whenever a term comes up in your coursework.
Students often apply the rule mechanically instead of understanding the nature of the account. Always identify whether the account is an asset, liability, expense, or income before applying debit-credit rules.
Straight Line Method charges a fixed amount every year on original cost; WDV charges a fixed percentage on the reducing balance. Using the wrong base value gives an incorrect depreciation figure.
Direction of adjustment depends on whether you're starting from the cash book balance or the passbook balance. Always identify your starting point before applying additions or subtractions.
A trial balance can tally even when errors exist — such as compensating errors or errors of complete omission. Tallying confirms arithmetical accuracy, not the absence of all errors.
Expenditure that creates a long-term benefit (like machinery purchase) belongs on the balance sheet, not the profit and loss account. Misclassifying it distorts both profit and asset values.