Bookkeeping
What is bookkeeping?
Bookkeeping is recording of daily business financial transactions up to date and it is part of the process of accounting in business.
It is a systematic process to maintain and organizing books of accounts accurately in a company. For every transaction there must be a supported document, you should maintain an accurate record for all accounts.
Transactions include the recording of sales, purchase, payment from customers, payment to suppliers, staff salaries, journal entries and other adjustment entries and bookkeeper is the responsible person to record day to day transactions.
A bookkeeper is the responsible person to take care of the all records properly like, cash transactions and credit transactions and posting daily transactions into correct ledger account.
For each business transaction, there must be a document like, sales invoice, supplier invoice and bank payments, and bookkeeper has to maintain separate files for all supported documents.
You have to produce supporting documents for every business dealing with the auditor for auditing purpose.
Example, auditor wants to audit all sales and purchase invoices, so you have to produce all related invoice files for audit.
Double entry bookkeeping
For every business transaction, there must be two accounts are involved is known as a double entry system of accounting. Here one account will be debited and another account will be credited.
Example
Rent Expenses A/c Dr
To Cash Account
Related Topics
Related Pages
- Fixed Asset Entries
- Payroll Journal Entries
- Accrued Expenses
- Prepaid Income
- Accounting Basics
- Debits and Credits
- Chart of Accounts
- Petty Cash
- Bank Reconciliation
- Accounts Payable Process
- Accounts Receivable Process
- Prepaid Expenses
- Discount Allowed and Discount Received
- Journal Entries
- Adjusting Entries
- Depreciation
- Current Liabilities and Current Assets