1. The left side of the balance sheet is "Assets" - tells what the money was used for. The right side is "Liabilities and Ownership Equity", which tells where the money came from (who is owed money).

2. The difference between current assets and non-current assets lies in whether they are assets that can be realized or used within one year or within an operating cycle of more than one year.

3. The difference between long-term equity investment and financial assets: Long-term equity only includes investments that have control, joint control, or can exert significant influence on the invested enterprise. Otherwise it is a financial asset.

4. Estimated net residual value; the value of a fixed asset at the end of its estimated useful life minus the estimated disposal costs.

5. Foreign land ownership can be privately owned, so land is a fixed asset. However, land ownership in our country can only be owned by the state, so land is an intangible asset.

6. The difference between assets and expenses: Assets can be exchanged for something useful in the future. For example, 10,000 yuan can buy a lot of office supplies. But the expenses are gone once they are used up. For example, 10,000 yuan in office supplies will become office expenses in the next few months. Therefore, prepaid rent and advertising expenses are deferred expenses. In many cases, today's assets are tomorrow's expenses, and there is only a difference in the concept of time.

8. Leasing is actually a company purchasing an asset in installments, and rent is the installment payment. The leased assets are considered to be the assets of the lessee. On its statements, the total rent to be paid in the future will also be recorded as a liability when the lease contract is signed, that is, long-term payables.

9. Bonds payable: The principal and interest of bonds issued by a company to raise (long-term) funds.

1. Name: Shareholders' equity is called owner's equity for a limited company, and shareholders' equity for a joint-stock company. It reflects the company's own capital. Share capital is called equity in a joint-stock company, but in a limited company, it requires paid-in capital, which is equal to the registered capital. To be precise, it is called paid-in registered capital.

2. Capital reserve and surplus reserve: The former refers to the amount of investment received by the enterprise from investors in excess of the price corresponding to its share of registered capital or share capital; the latter refers to the amount formed by the enterprise withdrawing 10% of its after-tax profits in accordance with regulations. It is the accumulation of income that is retained within the enterprise and has a specific purpose, which is unique to China.

1. Value-added tax is collected by enterprises from consumers on behalf of the state. It does not belong to the enterprise from beginning to end, so the value-added tax collected by the enterprise is a liability. It is a serious crime for a company to evade VAT.

2. Financial expenses: Financing expenses incurred by an enterprise to raise funds for production and operation in the short term, including interest expenses and income, exchange gains and losses and related handling fees, cash discounts incurred or received by the enterprise, etc. When financial expenses are negative, it means increased profits.

3. Investment income: interest income earned during the holding period of corporate bond investments.

Asset impairment loss: the loss caused by the enterprise's provision for impairment of various assets.

Non-operating income: An enterprise's income other than operating profits, such as government subsidies, profit gains, donation profits, etc. that have nothing to do with the daily activities of the enterprise.

Non-operating expenses: reflect the company’s expenses other than operating profits, including charity donations, extraordinary losses, losses, damage and scrapping of non-current assets, etc.

Production costs: This is the unsold inventory on the balance sheet

Operating cost: the cost in the income statement, which is the cost of the part of the product that is sold (in inventory).

Definition: Gross profit refers to the difference between operating income and operating costs. However, since operating costs only refer to the cost of the products sold in the production costs, operating costs are divided into variable costs and fixed costs. Fixed costs will be allocated between sold or inventory products. Therefore, the increase in inventory products may lead to a decrease in operating costs, which will lead to an increase in gross profits. Therefore, the increase in gross profits is not necessarily caused by performance improvements, but may also be caused by Finished goods inventories increased.

Definition: Research refers to the study of technology. Development refers to the costs incurred in designing and making molds in order to apply the technology to product manufacturing after successful technological research.

Accounting treatment

cash flow from operating activities

cash flow from investing activities

cash flow from financing activities

Debt financing: refers to the incorporation of funds through loans from banks, non-bank financial institutions or the discovery of bonds.

Equity financing: refers to a financing method in which the shareholders of the enterprise are willing to transfer part of the ownership of the enterprise, introduce new shareholders through the enterprise's capital increase, and at the same time increase the total share capital. This kind of financing enterprise does not need to pay principal and interest.

operating lease

Financing lease: has a long term and a large amount. From the perspective of accounting, it is a purchase method with installment payments. When an enterprise signs a financing lease agreement, the future rent must be recognized as a liability.