Business Exam 4 Flashcards
the terms accounting and bookkeeping are interchangeable

Following are the transactions and accounts of David Brown, executor of the estate of Henry Snow, deceased. For keeping the accounts, the journal, cash book, and ledger are the books used. The designing of pay-roll records to meet the special conditions in the great variety of manufacturing industries, offers a wide field for the ingenuity of the bookkeeper or accountant. Where all employes are paid a stated wage and their employment in one department is continuous, the problem is a simple one, resolving itself into a mere record of the number of hours worked each day, the rate, and the amount due. In certain lines of business a record of quantities of different kinds of merchandise sold is of almost equal value to records of values. A sales book designed for a business of this class is shown in Fig.

Occasionally one from whom we are purchasing goods will also be a customer. For reasons which will appear later, accounts should, in these cases, be opened in both the purchase ledger and the sales ledger. When settlement of such an account is made, the necessary adjusting entries are made through the journal. A report that lists the credit and debit balances of all general ledger accounts.


Maintaining a bill of exchange ensures it, right? Exhibit 2, below, shows the results after the second sales transaction event. Describe the different forms of binders with which you are familiar. Write an order form for the sale of 25,000 bushels of corn @ 76¼c made upon the orders of Mr. D.

  • He now writes articles on personal and corporate finance, accounting and tax matters, and entrepreneurship.
  • If certain facts assume importance, he must know how those facts can best be obtained and recorded.
  • Prepare a model trial balance of an imaginary business, or one with which you are familiar, giving special attention to the proper grouping of the accounts.
  • The routine followed by the accountant was to first take an inventory of machinery, material, supplies, goods in process, and manufactured goods.
  • An accountant will choose the correct recording practices or system.
  • In Germany, the railroads are controlled by the government.

An annual report is a corporate document that is provided annually to shareholders that represent the financial status of the company and describes their business operations from the previous year. Accounting is the process of recording, summarizing, analyzing, and reporting transactions made by businesses to government agencies. One of the hardest aspects of bookkeeping when you’re just starting out is keeping all of the terminology straight.


If you’re like most modern business owners, odds are you didn’t become one so that you could practice professional-level bookkeeping. Outsourcing the work to a seasoned bookkeeper can allow you to focus on your business plan and growth. Many people confuse the terms “Bookkeeping” and “Accounting,” but they are not interchangeable. https://www.bookstime.com/ Accounting and Bookkeeping both are parts of Accountancy. It necessitates a deeper understanding of Book-keeping records and the ability to analyse and interpret the information they contain. The recording phase of an accounting system is the purview of Book-keeping, whereas the summarising phase is the domain of accounting.

the terms accounting and bookkeeping are interchangeable

This set is kept in the most simple manner possible, the books used being journal, cash book, and ledger. When the advantages of double entry are demonstrated, few employers will object to a change from single entry. In most offices where single entry is still used, the reasons which have prevented a change may be summed up as ignorance of the double entry method, or a fear that double entry will increase the work without a corresponding benefit. This latter idea is a misconception inherited 92from the days of the old time bookkeeper, who considered it necessary to laboriously journalize every transaction.


At first glance, bookkeeping and accounting may seem interchangeable. While it may be easy to confuse the two, they are not the same thing. Accounting is the the terms accounting and bookkeeping are interchangeable umbrella term for all processes related to recording a business’s financial transactions, whereas bookkeeping is an integral part of the accounting process.

the terms accounting and bookkeeping are interchangeable

As soon as the goods are sent, an account is opened with the shipment, and the shipment is designated by the name of the consignee, a number, or the name of the place—as Shipment to Richard Roe. If more than one shipment is made to a commission merchant an account should be opened for each one in order that the gain or loss can be determined for individual shipments. The separate accounts should be designated by number—as Richard Roe, shipment No. 2. The records show quantities purchased and quantities sold. When the same goods have been purchased at different prices, use the last price paid in figuring inventory.

There should also be a sundries sales and purchase sheet for recording orders upon other commodities than grain or stock. Its form is the same as that shown with the exception that amount takes the place of shares, and commodities the place of stock in each form. Most brokerage firms have a number of customers outside of the city, and these customers as well as those in the city who are large buyers, keep a considerable deposit on hand with the broker at all times. This deposit is frequently augmented by advantageous sales or decreased by losses, commissions, and interest charges.

  • Maintaining a bill of exchange ensures it, right?
  • As owner of the estate, he can sue or be sued and perform many functions pertaining to the ordinary property owner.
  • The next improvement was necessitated by a desire on the part of those wholesale groceries which are located in cities having an efficient interurban electric car service to fill orders at different hours of the day.
  • Bookkeeping is the process of tracking and recording a business’s financial transactions.
  • It is sometimes called double carbon paper, and is mostly used by railroads in making up way bills on yellow (dandelion grade) tissue paper.
  • "To the extent which system is intelligently used, it multiplies one's powers of achievement in all directions."
  • A type of asset that includes currency as well as money in digital form, such as the sum in bank accounts.
  • We provide third-party links as a convenience and for informational purposes only.

This paper is for use where it is necessary or desirable to make a carbon copy from which to make a letter-press copy. Hektograph carbons are for making carbon copies to be used in a hektograph. There is no article which is so generally misused in the commercial world and which is so little understood as carbon paper. In order that the correct usage may be clearly understood a brief description of its manufacture is given. It manifolds quite well up to six and seven copies. It is possible to write only ten figures of this size to the inch.

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