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| Question | Answer |
| Opportunity cost | a choice that has to be given up in favour of another choice |
| Budget | a document that provides details of money that is coming in and going out, and also looks into the future and estimates future earning and spending |
| Payee | the person to whom a cheque is made out |
| Drawee | The bank named on a cheque |
| Drawer | the person drawing funds named on a cheque |
| Not negotiable | an order on a cheque stating that only the payee can put the money into his or her bank account |
| Overdraft | service provided by a bank whereby a person can withdraw money from the bank in excess of the money held in his or her account |
| PAYG | Pay As You Go |
| Income | the moneys made by individuals for providing goods or services, or moneys received from the government in the form of welfare benefits |
| ATO | Australian Taxation Office |
| Tax-free threshold | Money earned without paying tax |
| Cheque Butt | common business practice to make all payments by cheque. Provides all details required about cash payments made by the business and all necessary details to make an entry in the firm’s cash payments journal. |
| Cheque | an order from the customer to the bank to pat the sum of money nominated on the cheque |
| Receipt | is an amount of money coming into the business |
| GST | the tax customers pay for the goods or services they pay that gets paid to the government by the business |
| ABN | Australian Business Number. An official number, which a business needs for a number of purposes, including paying GST |
| Invoice | There are two main types of invoices used in a small business: sales invoice and purchase invoice |
| Sales invoice | is issued to a customer when a credit sale is made. This means the customer promises to pay for the goods or services at a later date |
| Purchase invoice | is received by the business when a credit purchase is made from one of their suppliers. This means the business promises to pay for the items they purchase for their business at a later date. |
| Credit note | this document is issued when goods have been returned due to being faulty or damaged, the wrong size, brand or colour. |
| Payment | is an amount of money leaving the business |
| Journals | are used to record the receipts and payments of a business. Allow the business owner to see where his or her money is coming from and going to. |
| Balance sheet | an accounting report showing assets, liabilities and owner’s equity at a given time |
| Assets | the possessions of people or businesses, such as cash and equipment |
| Debtor | a person or business who owes a business money |
| Liabilities | money owed by a business |
| Creditors | people or businesses to whom a business owes money |
| Owner's equity | the owner’s investment in the business |
| Profit | the money coming into a business from the sale of goods and services less the costs incurred in providing the goods and services for sale |
| Profit and Loss statement | an accounting report that shows revenue minus the expenses, and the profit or loss for a period of time |
| Revenue | the money coming into a business from the sale of goods and services |
| Expenses | the costs incurred in providing the goods and services for sale; that is, goods and services used up in earning revenue |
| EFTPOS | electronic funds transfer at point of sale |
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