What are Accounting and Bookkeeping ?
Understanding Accounting and Bookkeeping
This webpage is designed to help business start-ups and students to understand the basics of accounting and bookkeeping. Please email us if you require further help and explanations.
An Everyday Business
A business makes sales and purchases almost every day. Money goes into and out of Bank Accounts. Bills come in from suppliers and get paid. Bills are sent to customers and usually get paid.
Sometimes products are bought to sell, but they are not sold immediately, and are therefore in stock. Consequently some products are sold today which could have been bought some time ago.
The business owner needs to keep records of all this coming and going for quite a few reasons. The main and best reason is to keep track of profit (or loss), which is very important.
It is also a legal requirement keep records, especially for the tax authorities.
Other people who are interested will be anyone who has lent money to the business, especially a bank.
Please visit our webpages on the following subjects:
Accounting Reports: Balance Sheet, Profit & Loss Account, Cash Flow.