Glossary – Accounting

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There are 10 names in this directory beginning with the letter E.
Earnings per share (EPS)
This financial statistic is the net income of a corporation after income tax (less any preferred dividends) divided by the weighted average number of shares of common stock outstanding during the same period of time.

Economic entity assumption
An accounting principle/guideline that allows the accountant to keep the sole proprietor’s business transactions separate from the owner’s personal transactions even though a sole proprietorship is not legally separate from the owner.

Electronic funds transfer (EFT)
A method of payment used in place of a paper check.

Employer payroll taxes
Employer payroll taxes include an employer’s portion of Social Security and Medicare taxes and the state and federal unemployment taxes.

End of month.

Economic order quantity.

Earnings per share.

The difference between assets and liabilities, such as stockholders’ equity, owner’s equity, or a nonprofit organization’s net assets. Also used to indicate an owner’s interest in a personal asset.

A payment. The expenditure might be for a significant long term asset (capital expenditure), a short term asset (prepaid insurance), a reduction in a liability, or for an immediate expense such as rent.

Expired costs
Costs that have been used up or consumed. Expired costs are reported as expenses. (Costs that have not yet expired are reported as assets).