The business is treated as a separate entity, separated from its owners, creditors and customers. Sole Proprietorship A one-owner business. Accounting Planning, recording, analyzing and interpreting financial information.

Owner’s Equity

The owner’s right to or investment in the business.

Revenues

The amounts earned by a business.

Separate Entity Concept

The business is treated as a separate entity, separated from its owners, creditors and customers.

Sole Proprietorship

A one-owner business.

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.

Service business

A business that preforms an activity for a fee.

Asset

Anything of value that is owned.

Equities

Financial rights to the assets of a business.

Liability

A amount owed by a business.

Owner’s equity

The amount remaining after the value of all liabilities is subtracted from the value of all assets.