Category: Bookkeeping Tasks
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How the Balance Sheet is Prepared
If you’re using bookkeeping software, then preparing the balance sheet is often as simple as the click of a button — but what if you’re doing things the old fashioned way? Bookkeeping with physical books, or even with spreadsheets is a different animal and requires a bit more patience. At the end of an accounting…
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The Accounting Cycle, Part 4
Today we reach the final daily step for each individual transaction: recordation. Don’t get too excited, the accounting cycle is far from over, but many aspects of it take place at the end of the accounting period. Double-entry accounting dictates that each transaction be recorded in at least two accounts. Debits and credits need to…
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The Accounting Cycle, Part 3
The next step in the Accounting Cycle is determining which accounts are affected by the transaction. In order to record these transactions properly, the bookkeeper should be thoroughly familiar with that business’s chart of accounts. Transactions that are similar can affect different accounts. In Part 1, I mentioned that customer purchases made with cash or…
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The Accounting Cycle, Part 2
The next part of the Accounting Cycle is the gathering of documentation. This is often easier said than done, since the receipt isn’t the first thing on someone’s mind when making a purchase. However, documentation is crucial. An accounting transaction requires proof, or it has no place in the books. Source documents go beyond simple…
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The Accounting Cycle, Part 1
The first part of the Accounting Cycle is to collect accounting transactions and identify the events behind them. There are many events that cause an accounting transaction. These include but are not limited to: If money changes hands, or there is the promise of money changing hands at a later date, an event has occurred.…
Lavender Books 