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Accounting Planning, recording, analyzing, and interpreting financial information. Accounting system A planned process for providing financial information that will be useful to management. Accounting records Organized summaries of a business's financial activities. Financial statements Financial reports that summarize the financial condition and operations of a business are called. Service business A business that performed an activity for a fee. Proprietorship A buisness owned by one person. Asset Anything of value that is owned. Equities Financial rights to an asset of a buisness. Liability An amount owed by a buisness. Owner's equity The amount remaining after the value of all liabilities is subtracted from the value of all assets. Accounting equations An equation showing the relationship among assets, liabilities, and owner's equity. Ethics The principles of right and wrong that guide an individual in making dicisions. Business ethics The use of ethics in making buisness decisions. Transactions A business activity that changes assets, liabilities, or owner's equity. Account A recording summarizing all the information pertained in to a single item in the accounting equations. Accounting title The name given to an account. Accounting balance The amount in an account. Capital The amount used to summarize the owner's equity in a business. Revenue An increase in owner's equity resulting from the operation of a business. Sale on account A sale for which cash will be received at a later date. Expense A decrease in owner's equity resulting from the operation of a business. Withdraw Assets taken out of a business for the owner's personal use.