Category: Bookkeeping 101

average payment period

May 13, 2020 Bookkeeping 101 by ann
Accounts payable turnover is a ratio that measures the speed with which a company pays its suppliers. If the turnover ratio declines from one period to the next, this indicates that the company is paying its suppliers more slowly, and may be an indicator of worsening financial condition. A change in the turnover ratio can
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What are the types of transaction in accounting?

May 12, 2020 Bookkeeping 101 by ann
AccountingTools A journal entry is usually printed and stored in a binder of accounting transactions, with backup materials attached that justify the entry. This information may be accessed by the external auditors as part of their year-end investigation of a company’s financial statements and related systems. What are Accounting Transactions? When employees are to be
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A Beginner’s Guide to The Accounting Cycle

May 12, 2020 Bookkeeping 101 by ann
Keeping accurate financial documents is not an option. The accounting cycle is the system in which businesses record their transactions in order to prepare required financial statements. However, many business owners don’t understand this process fully, so we’re breaking it down in today’s post. At the end of an accounting period, Closing entries are made
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Journal entry definition

May 12, 2020 Bookkeeping 101 by ann
In 1973, the SEC decided to replace CAP with the Financial Accounting Standards Board (FASB), which is still in place today. On the recommendation of the American Institute of CPAs (AICPA), the FASB was formed as an independent board in 1973 to take over GAAP determinations and updates. The board is comprised of seven full-time,
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Branches of Accounting

May 12, 2020 Bookkeeping 101 by ann
There are a number of principles, but some of the most notable include the revenue recognitionprinciple, matching principle, materiality principle, and consistency principle. It also involves generating financial statements based on these transactions. All financial statements, such a balance sheet and income statement, must be prepared according to the generally accepting accounting principles (GAAP), according
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