Every accounting term used in Parline, in plain language. These are the same definitions that pop up when you hover a dotted-underlined word anywhere in the app.
An account is a category you track a running total for. "Checking" is an account; so is "Software Subscriptions" and "Owner's Draw."
Every line of every transaction points at one account. Your reports are really just these account totals, arranged.
See also: Chart of Accounts, asset, liability, equity, revenue, expense, sub-type
Accounts payable (A/P) is the mirror of receivable: a bill you've got but haven't paid.
It's a liability. Aging it shows which bills are coming due or overdue.
See also: accounts receivable, aging, liability
Accounts receivable (A/R) is revenue you've earned but not yet collected - an invoice sent, payment pending.
It's an asset: it's money coming to you. Parline can age it (how overdue each amount is) so you can chase what's late.
See also: accounts payable, aging, asset, revenue
Accrual accounting books a sale when you deliver the work (not when you're paid) and a cost when you receive the goods (not when you pay). It gives a more matched picture over time but is more work to maintain.
Larger businesses and some lenders expect accrual. Most small businesses don't need it - Parline is built around cash basis.
See also: cash basis
An aging view groups each outstanding amount by how long it's been unpaid. It turns "customers owe us $4,000" into "$3,000 is current, $1,000 is over 60 days late."
It's the tool for deciding who to follow up with and how urgently.
See also: accounts receivable, accounts payable
Assets are what you have. Cash in the bank, a laptop the business bought, inventory, and money owed to you by customers all count.
Assets go up with a debit. Their combined total is one side of the Balance Sheet.
See also: liability, equity, Balance Sheet, accounts receivable
The Balance Sheet lists your assets on one side and your liabilities plus owner's equity on the other, as of a chosen date. The two sides always equal - hence "balance."
Lenders and grant funders almost always want to see one. It answers: what does this business have, what does it owe, and what's the owner's stake?
See also: Income Statement, Statement of Cash Flows, asset, liability, equity
If your checking account had $4,200 in it the day you started using Parline, that's its beginning balance. It's the starting point the running total builds on.
Set beginning balances in the Chart of Accounts so your first Balance Sheet reflects reality, not just the transactions you've entered since.
See also: account, Balance Sheet, trial balance
Bookkeeping is just the habit of recording money as it moves: a date, an amount, and what it was for. Do that consistently and everything else - your reports, your tax numbers, a loan application - builds itself from the record.
You don't need training to keep books. You need a place to put each transaction and a little guidance on where it goes. That's what Parline is.
See also: journal entry, cash basis
On a cash basis, a sale counts when the customer pays, and a cost counts when you pay it. It matches your bank account and it's how most small businesses file taxes.
Parline guides you toward cash basis. It's simpler and it's enough for the vast majority of small businesses.
See also: accrual basis, Statement of Cash Flows, bookkeeping
The Chart of Accounts is the master list: every account you use, grouped by type (asset, liability, equity, revenue, expense).
Parline gives you a sensible starter list during setup. Add, rename, or hide accounts any time - nothing is locked except a few built-in ones the app needs.
See also: account, system account, sub-type
Once a month or year is done - reported, filed, handed to a lender - you close it. After that, Parline blocks edits to any transaction dated in the closed period.
It protects numbers you've already relied on. The owner can reopen a period if something genuinely needs fixing.
See also: period lock
Commingling is the default for a lot of new businesses: one checking account, one card, business and personal charges mixed on every statement.
It makes the business's real numbers impossible to see at a glance - and it's exactly the problem Parline is built to solve. You keep two sets of books and tag each transaction to the one it belongs to.
See also: owner's draw, owner's contribution
Credit is the right side of an entry - the mirror of debit. Like debit, it isn't inherently positive or negative.
A credit increases revenue, what you owe, and owner's equity; it decreases assets like cash. Every entry's credits total exactly what its debits total.
See also: debit, double-entry, revenue, in balance
Debit and credit are just "left" and "right." They are not "good" and "bad," and a debit is not always an increase - it depends on the type of account.
For your assets (cash, equipment), a debit increases the balance. For what you owe and for revenue, a debit decreases it. The one rule that always holds: the debits and credits in an entry are equal.
In everyday use you rarely type "debit" - you say "money came into checking" and Parline puts it on the right side.
See also: credit, double-entry, journal entry, asset
Money never appears from nowhere. If cash goes up, something else has to explain it - you earned it, borrowed it, or the owner put it in. Double-entry just writes down both sides.
Because the two sides always equal each other, the books can't quietly drift out of balance. If they don't match, you know something's missing - and that's a feature, not a chore.
Parline handles the two-sided part for you in most places. You say what happened in plain terms; it records both sides.
See also: debit, credit, journal entry, in balance
Equity (also "owner's equity") is the owner's stake: assets minus liabilities. If you sold everything and paid every debt, equity is what you'd walk away with.
It grows when the business earns a profit or the owner puts money in, and shrinks with losses or an owner draw.
See also: asset, liability, Owner's Equity, retained earnings, net income
An expense is a cost of running the business: rent, materials, a subscription, bank fees, contractor payments.
Expenses sit below revenue on the Income Statement. Subtract them from revenue and you get net income.
See also: revenue, Income Statement, net income
The general ledger is the full history: every journal entry, every line, every account it touched. In Parline this is the Transactions screen.
Every report - Balance Sheet, Income Statement, Cash Flow - is a different way of summarizing the same ledger.
See also: journal entry, trial balance
Gross profit is what's left of revenue after the costs tied directly to the sale (materials, the contractor who did the work). It shows whether the core work itself is priced to make money.
Subtract your operating expenses from gross profit and you get operating income.
See also: revenue, operating income, net income, Income Statement
"In balance" means the debits and credits of a single entry add up to the same number. Parline won't save an entry that doesn't.
The whole set of books is in balance when total assets equal what you owe plus owner's equity - that's what the Balance Sheet checks.
See also: journal entry, double-entry, Balance Sheet
Also called a profit-and-loss (P&L). It starts with revenue, subtracts expenses, and ends with net income for the month, quarter, or year you pick.
Where the Balance Sheet is a snapshot on one day, the Income Statement covers a stretch of time.
See also: Balance Sheet, Statement of Cash Flows, revenue, expense, net income, gross profit
A journal entry is a single event in your books: "got paid $500 by Acme on March 3," "bought $40 of supplies."
Each entry has at least two lines, and the lines always balance - total in equals total out. Parline checks that for you before it saves.
See also: double-entry, debit, credit, in balance, source
Liabilities are what you owe to someone else: a bank loan, an outstanding credit-card balance, a supplier invoice you haven't paid yet.
A liability goes up with a credit. What you owe plus owner's equity always equals your assets.
See also: asset, equity, accounts payable, Balance Sheet
Net income is the final figure on the Income Statement: total revenue minus total expenses. Positive is a profit, negative is a loss.
At year end it rolls into equity as retained earnings - the accumulated profit the business has kept.
See also: revenue, expense, retained earnings, Income Statement
Operating income is revenue minus all the ordinary costs of operating - the direct costs and the overhead. It leaves out unusual, one-time items and interest.
It's a cleaner read on "is the business itself working" than the very bottom line, which can be swung by a single odd event.
See also: gross profit, net income, Income Statement
When you cover a business cost with your personal card or move personal savings in, that's a contribution. It increases equity, not revenue.
Recording it correctly keeps your revenue honest and shows how much of the business the owner has personally funded.
See also: owner's draw, Owner's Equity, commingling, revenue
When you move business money to yourself, that's a draw, not an expense. It doesn't reduce profit; it reduces equity.
Keeping draws separate from expenses is a big part of un-commingling - it's the difference between "the business spent this" and "I paid myself."
See also: owner's contribution, Owner's Equity, commingling, expense
Owner's Equity gathers the owner's investment in and claim on the business. Alongside retained earnings, it's the equity side of the Balance Sheet.
Money the owner puts in increases it; money the owner takes out (a draw) decreases it.
See also: equity, retained earnings, owner's draw, owner's contribution
The period lock is just the cutoff date set when you close the books. Transactions on or before it are read-only for everyone.
You'll see a banner on the ledger when a lock is in place, and locked rows are marked.
See also: closing the books
Reconciling means lining up what Parline says an account did against what the bank statement says, transaction by transaction, until the ending balances match.
Differences point to something specific: a transaction you missed, a duplicate, a wrong amount or date. Parline can build a prompt you run through an AI tool to spot those quickly.
See also: general ledger, in balance
Each year's net income adds to retained earnings (a loss subtracts). It's the part of equity that came from the business earning money rather than the owner putting money in.
Parline keeps this as a locked system account and folds the current period's net income into it on the Balance Sheet automatically.
See also: net income, equity, Owner's Equity, system account
Revenue is what you bring in by doing the thing your business does: selling a product, billing for a service, collecting a fee.
It's the top line of the Income Statement. Revenue minus expenses is your net income.
See also: expense, Income Statement, net income, gross profit
Each entry records how it was created: manual, AI import, or an automatic entry from a feature like receivables. It's just provenance - useful when reviewing.
Some sources are read-only in the ledger because another part of the app manages them.
See also: journal entry, general ledger
Profit and cash aren't the same thing. You can be profitable and still short on cash (a customer hasn't paid yet), or cash-rich in a losing month (you took a loan).
The Cash Flow statement tracks the actual movement of cash, split into operating, investing, and financing activity.
See also: Balance Sheet, Income Statement, cash basis
Each account has a broad type (asset, liability, equity, revenue, expense) and a sub-type that says a bit more: is this asset cash-like and short-term (Current Asset) or long-term (Non-Current Asset)?
The sub-type decides how the account is grouped on the Balance Sheet and how it's treated on the Cash Flow statement. Parline picks a sensible one for you; you can change it.
See also: account, Chart of Accounts, Balance Sheet
A few accounts are created automatically and locked: things like Retained Earnings and the "Uncategorized" holding accounts. The app relies on them, so they can't be removed.
You can still post to them and see their balances. Everything else in your Chart of Accounts is yours to change.
See also: Chart of Accounts, retained earnings
Tags are a second way to slice your data, independent of the account. Tag every line for one project and you can see that project's totals no matter which accounts it touched.
They're optional and entirely yours to define.
See also: journal entry, account
A trial balance lays out every account's ending balance in two columns (debit and credit) and confirms the totals match.
It's a standard part of a year-end package an accountant works from.
See also: general ledger, beginning balance, in balance