bookkeeping

Examples of bookkeeping in the following topics:

• Inputs to Accounting

  • In accounting, the two bookkeeping methods are the single-entry and double-entry bookkeeping systems.
  • Bookkeeping is the recording of financial transactions.
  • Bookkeeping is usually performed by a bookkeeper.
  • There are some common methods of bookkeeping such as the single-entry bookkeeping system and the double-entry bookkeeping system.
  • The bookkeeper brings the books to the trial balance stage.

• Defining Accounting

  • One important breakthrough took place around that time: the introduction of double-entry bookkeeping, which is defined as any bookkeeping system in which there was a debit and credit entry for each transaction, or for which the majority of transactions were intended to be of this form.
  • The earliest extant evidence of full double-entry bookkeeping is the Farolfi ledger of 1299-1300.
  • It represents the first known printed treatise on bookkeeping; and it is widely believed to be the forerunner of modern bookkeeping practice.
  • Although Luca Pacioli did not invent double-entry bookkeeping, his 27-page treatise on bookkeeping contained the first known published work on that topic, and is said to have laid the foundation for double-entry bookkeeping as it is practiced today.
  • The invention of a form of bookkeeping using clay tokens represented a huge cognitive leap for mankind.

• Types of Transactions

  • In double-entry bookkeeping, a sale of merchandise is recorded in the general journal as a debit to cash or accounts receivable and a credit to the sales account.
  • Fees for services are recorded separately from sales of merchandise, but the bookkeeping transactions for recording sales of services are similar to those for recording sales of tangible goods .

• Debits and Credits

  • Credit and debit are the two fundamental aspects of every financial transaction in the double-entry bookkeeping system.
  • Debits and credits are at the heart of the double-entry bookkeeping system that has been the foundation stone on which the financial world's accounting system has been built for well over 500 years.
  • Debits and credits serve as the two balancing aspects of every financial transaction in double-entry bookkeeping.

• The Trial Balance

  • The trial balance is usually prepared by a bookkeeper or accountant.
  • The bookkeeper/accountant used journals to record business transactions.
  • The trial balance is a part of the double-entry bookkeeping system and uses the classic 'T' account format for presenting values.
  • If debits do not equal credits then the accountant or bookkeeper must determine why.

• Fundamental Accounting Equation

  • A double-entry bookkeeping system involves two different "columns;" debits on the left, credits on the right.

• Reversing Entries

  • Reversing entries help prevent accountants and bookkeepers from double recording revenues or expenses.

• Posting

  • Since accountants and bookkeepers often need to trace the origin of a ledger entry, they use cross-indexing.

• Activities to Manage Receivables

• Journalizing

  • The general journal is where double entry bookkeeping entries are recorded by debiting one or more accounts and crediting another one or more accounts with the same total amount.