Questions About Bookkeepers You Must Know the Answers To

Systems Used In Bookkeeping Services As a business owner, being able to have knowledge of different kinds of bookkeeping systems will help you to decide what kind of system will be more appropriate for your business transactions. There are 2 kinds of bookkeeping systems used today as a matter of fact and these are Double Entry Bookkeeping systems and Single Entry Bookkeeping systems. When it comes to single entry bookkeeping system, this is perfect for businesses under small scale category. This system is used to maintain record of business transactions related to cash receipt, cash disbursements, sales and purchases. Well the truth is, this system is more of an informal system perfect for small business transactions. The bookkeeper here is typically using this system to be able to maintain the day to day summary of cash payments and receipts and at the same time, the monthly summary of cash payments and receipts. Every single transaction affects just one account in a single entry bookkeeping procedure. In case of a double entry transaction on the other hand, every transaction would have entry on both accounts.
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If there’s a sale for a certain item, the cash deposit or receipt account only updated with received amount. Corresponding entry in sales account won’t be made in single entry bookkeeping system. Hence, it is not providing complete financial standing of different systems in the business. If you want a more detailed transaction for different systems that are used in the business transaction, then that’s the time you must go for double entry system.
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In regards to double entry bookkeeping system, this is a kind of bookkeeping system that is mostly used by accountants or bookkeepers in a business. This system is mostly used to complete the accounting details of transactions that are made by the business and at the same time, to introduce the concept of credit and debit. Because of the reason that there are several accounting systems that are implemented in a business, debit entry in one of the accounting systems will be accompanied by credit entry as well but in a different accounting system or perhaps, in more than one accounting system. And likewise, the bookkeepers should have different debit entries for one credit entry. The company’s financial performance can be ascertained clearly based on accounting details acquired from double entry bookkeeping systems. Manual bookkeeping and the other is computerized bookkeeping are basically the two methods of how bookkeeping is done. In manual, it’s actually the oldest method of bookkeeping to which the bookkeeper use a journal or ledger book to record different accounting entries that are related to business transactions. In computerized on the other hand, it’s like manual processes but computerized.

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