What do you mean by BOOKKEEPING?

Bookkeeping involves systematically recording and organizing financial transactions such as purchases, sales, expenses, and revenues within an organization. It provides accurate records that serve as the basis for financial reporting and analysis, enabling businesses to monitor their financial status and make informed decisions.

What are the basics in bookkeeping?

The basic bookkeeping process involves recording financial transactions in journals, posting them to ledgers, creating trial balances to verify accuracy, preparing financial statements such as the income statement and balance sheet, and reconciling discrepancies to ensure the integrity of financial records. These steps are essential for maintaining organized and accurate financial information within an organization.

why is bookkeeping used?

Bookkeeping is essential for maintaining organized financial records of a company's activities. It helps businesses track income, expenses, assets, and liabilities, providing insights into financial performance and aiding in decision-making. Accurate bookkeeping ensures compliance with tax regulations, meets reporting requirements, and supports securing loans or investments. It also facilitates effective cash flow management and overall financial health evaluation.

What are the three types of BOOKKEEPING

Single-Entry Bookkeeping: Simple list-based recording, suitable for small businesses with straightforward finances.

1. Double-Entry Bookkeeping: Comprehensive method requiring two entries per transaction to balance debits and credits.

2. Computerized Bookkeeping: Uses software to automate and streamline financial data recording and tracking.

What is the DIFFERENCE between accounting and bookkeeping?

Bookkeeping: Involves recording and organizing financial transactions, including data entry and maintaining ledgers.

• Accounting: Involves analyzing and interpreting financial data from bookkeeping to make forecasts, provide financial advice, and prepare financial statements.

Bookkeeping captures data accurately, while accounting provides strategic insights based on that data.