Free Accounting Course

This page contains our free online accounting course. It will teach you the basics of accounting and finance.

The Course Covers:

The basics of accounting

Fundamentals of financial statements

Definitions of common financial terminology

Course Modules:

Lesson 1: An Introduction to Accounting and Finance

Lesson 2: Accounting and Financial Terminology

Lesson 3: Understanding Financial Statements

To start the online course, scroll down

This course is FREE, and no registration is required.

It is perfect for beginners!

Jump to:

An Introduction to Accounting

Fundamental Accounting Terminology

Understanding Financial Statements

accounting introduction

Our Free Online Accounting Course

Part 1: An Introduction to Accounting

Module overview:

Course Overview
Who should take this course
What to expect
An Introduction to accounting

1.1 Who should learn accounting?

Understanding the basics of accounting is an essential skill that everyone should possess, as we all encounter some form of accounting on a regular basis.

The course is designed for anyone interested in learning accounting, particularly business owners, company directors, entrepreneurs, accounting students, business students, bookkeepers, and individuals with a general interest in the field.

1.2 What is covered in the course?

The course will include:

Basic financial terms
Basic accounting principles
Financial statement basics
Various accounting and finance insights

Pitstop Practice!

Ponder:

Why am I taking this course?

What do I want to achieve?

Okay? Continue!

If not, ensure you watched the video

accounting terminology

Part 2: Accounting Terminology Explained

Module overview:

What are sales and expenses?
What are assets and liabilities?
Asset examples
Liability examples

2.1 What are sales?

A sale is the agreed-upon cash exchange for providing a good or service.

Some sales result in an immediate exchange of cash, such as customers buying at the checkout of a shop. These are cash sales. Other sales result in money being exchanged later, even though the goods or services have already been provided. These are credit sales, including an invoice detailing the sale and payment terms.

Sales are also referred to as revenue, income, and turnover.

2.2 What are expenses?

An expense is a cost incurred by a business, company or other entity.

Typical expenses include rent, fuel, vehicle expenses, stationery, printing, postage, insurance, software, computer costs, property maintenance, wages, salaries, subscriptions, training, and travel costs.

Like sales, expenses are incurred in cash or credit. These are referred to as cash purchases and credit purchases.

Expenses are also referred to as overheads, outgoings, and purchases.

2.3 What are assets?

An asset is something a business, company, or other entity owns and has monetary value.

Examples of assets:

Office furniture

Motor vehicles

Machinery

Tools

Property

Assets can be tangible (physical), like an office desk. Assets, like copyrights and patents, are intangible (non-physical).

The primary difference between assets and expenses lies in their resale value. Expenses, such as rent, insurance, and salaries, often have little or no value and cannot be resold. Assets have monetary value and could be sold if needed.

Cash and debts owed to a business are also assets.

2.4 What are liabilities?

Liabilities are the opposite of assets - something that the business owes.

Examples of liabilities:

Bank loans

Credit cards

Finance and lease agreements

Taxes

Money owed to suppliers

Pitstop Practice!

Explain:

What are assets?

What are liabilities?

What are sales and expenses?

Consider my Accounting Mentor Program

financial statement basics

Part 3: Financial Statements for Beginners

Module overview:

Financial statements explained
The profit and loss statement
The balance sheet
And more

3.1 Financial Statement Basics

Two of the most common financial statements are the profit and loss statement and the balance sheet.

These statements utilise sales, expenses, assets, liabilities, and equity to demonstrate a company's financial health and performance.

3.2 The Profit and Loss Statement

This financial statement displays total sales versus total expenses for a specified period. It details the total profit or loss an entity has made.

The profit and loss statement is also called the income statement.

The sales minus the cost of sales equals the gross profit. Cost of sales refers to purchases that have a direct relationship with generating sales. Typical costs of sales are products bought for resale, distribution costs, raw materials purchased for production, post and packaging costs, and subcontractor costs.

Gross profit minus expenses equals the net profit. The bottom line. The overall profit of the business.

3.3 The Balance Sheet

This financial statement shows everything an entity owns and owes at a selected date.

The balance sheet is also referred to as the statement of financial position.

Typical items that show on a balance sheet are cash (bank balances), stock, trade debtors, trade creditors, loans, and retained earnings. These are categorised as fixed assets, current assets, current liabilities, long-term liabilities, and equity.

Fixed assets are assets which do not regularly change value. Common fixed assets are properties, equipment, and vehicles.

Current assets are assets which regularly change value. Common current assets include accounts receivable (cash owed from customers) and bank balances.

Long-term liabilities are liabilities due in more than twelve months from the date on the balance sheet. Common long-term liabilities are loans and mortgages.

Current liabilities are liabilities which are due within twelve months of the date of the balance sheet. Common current liabilities include accounts payable (cash owed to suppliers) and credit card balances.

The reason why this statement is called a balance sheet is that the total assets should equal the total liabilities and equity.