There are various transactions that are carried out as businesses are run comprising of sales, purchases, and receipts among others. Small business bookkeeping services involved the keeping of financial records usually done by the accounting department. Usually, there exists several methods of maintaining the said records for instance, double and single accounting system of entry. The criteria of choosing the method to use depends on the type of business, size of transactions and the frequency of keeping records.
These services are performed by a bookkeeper who is also referred to as an accounting technician or else an accounts clerk. They play the role of maintaining daily commercial transactions of the enterprise. These could include purchasing of stock, sale of items, creditors, debtors and also payments made such as water and electricity bills, just to mention a few. This accounting technician should ensure that the entries made are correct and made in the appropriate book.
The variation between the two commonly used recording structures lies in the design and content. In using the single system one should not include records of liabilities and capital and is thus preferred when taking down of daily cash disbursements, for instance the Cash Book. On the other hand in the double one, one is required to include the liabilities and equity and is used for purposes of long term analysis of transactions made with a good example being the Balance Sheet.
The importance of these services to businesses include, better business planning, fulfillment of tax obligations, source for investors and is a requirement by the law for auditing reasons among others. The effects of having inefficient system, can be delayed payments to the suppliers, challenges in noticing inconsistencies in the business, minimal growth of a firm and high tax penalties. For the small entities records are not bulky and can be kept on a daily or monthly basis.
The process used when maintaining records, accounts for the commercial effects of transactions. The contrast between the use of electronic devices and the manual input lies only in potential of recording of monetary deals and the placing of data in most applicable account. The use of a manual system is chiefly characterized by lagging or delay which is absent in electronic input as it is instantaneous.
When a small organization has a good accountant, he/she make certain that proper records are being kept in order to avoid any examples of errors. This help in ensuring that this business grows in an efficient as well as effective manner. Nevertheless, due to the size of the business, a business owner may make the decision of keeping and maintaining records on his own. In such a case, it is recommended that he have basic knowledge of accounting.
Furtherance, the owner who does the accounting on his own requires to have records of all receipts be it cash or the purchases, and the invoices involving the expenses of the particular organization. These include bills such as electricity and water, bank statements and credit card, among others. In case the business have employees, the manager ought to keep the records on payroll.
Ultimately, computation of a trial balance is needed. It is from this that statement of income and balance sheets are formulated. Important to note is that book keeping is crucial to a business.
These services are performed by a bookkeeper who is also referred to as an accounting technician or else an accounts clerk. They play the role of maintaining daily commercial transactions of the enterprise. These could include purchasing of stock, sale of items, creditors, debtors and also payments made such as water and electricity bills, just to mention a few. This accounting technician should ensure that the entries made are correct and made in the appropriate book.
The variation between the two commonly used recording structures lies in the design and content. In using the single system one should not include records of liabilities and capital and is thus preferred when taking down of daily cash disbursements, for instance the Cash Book. On the other hand in the double one, one is required to include the liabilities and equity and is used for purposes of long term analysis of transactions made with a good example being the Balance Sheet.
The importance of these services to businesses include, better business planning, fulfillment of tax obligations, source for investors and is a requirement by the law for auditing reasons among others. The effects of having inefficient system, can be delayed payments to the suppliers, challenges in noticing inconsistencies in the business, minimal growth of a firm and high tax penalties. For the small entities records are not bulky and can be kept on a daily or monthly basis.
The process used when maintaining records, accounts for the commercial effects of transactions. The contrast between the use of electronic devices and the manual input lies only in potential of recording of monetary deals and the placing of data in most applicable account. The use of a manual system is chiefly characterized by lagging or delay which is absent in electronic input as it is instantaneous.
When a small organization has a good accountant, he/she make certain that proper records are being kept in order to avoid any examples of errors. This help in ensuring that this business grows in an efficient as well as effective manner. Nevertheless, due to the size of the business, a business owner may make the decision of keeping and maintaining records on his own. In such a case, it is recommended that he have basic knowledge of accounting.
Furtherance, the owner who does the accounting on his own requires to have records of all receipts be it cash or the purchases, and the invoices involving the expenses of the particular organization. These include bills such as electricity and water, bank statements and credit card, among others. In case the business have employees, the manager ought to keep the records on payroll.
Ultimately, computation of a trial balance is needed. It is from this that statement of income and balance sheets are formulated. Important to note is that book keeping is crucial to a business.
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