Business Exam 4 Flashcards

The slips are then sorted according to customers. If Mrs.
J. B. Jackson has bought goods in three different departments, the
auditing department will pin the three slips together and mark the
total of the slips to be charged to her account on the back of the
under slip. If there are twelve bill clerks and twelve billing machines,
all the slips will then be assorted into twelve lots, each lot
representing the number of accounts taken care of by each bill clerk. If computing machines are needed for adding, multiplying, and
taking off discounts, the non-listing machines are recommended, as
they are key-driven.

The finish of the paper which
is being written upon is also a factor. Papers with a hard finish—that
is, a shiny surface—do not allow the color of the carbon paper
to take hold, and yet a paper with the soft finish will allow the color
to spread, and make a poor copy. This class of paper is also used
for making a few copies on very light-stroke machines like the Hammond. At one time a speed contest between pen billers and machine
billers was held on one of the large railroads of this country, and
permission was given the machine people to change the position of
the headings of the freight bills.

Overview: What is bookkeeping?

Suppose card No. 964 is missing; a search through
the row of No. 4 tabs will locate it, no matter where filed. With this
system of filing, a separate index by name is required, and this also
is https://www.bookstime.com/ made on cards. For a very large ledger the numerical system is
more frequently adopted than the alphabetical. A subdivision of the alphabetical index is the geographical or
territorial.

Without the ledger division and the use of controlling accounts,
there would be nothing to assist in locating an error in the
trial balance in any particular section of the ledger. Records that portray an organization’s financial situation. The three main financial statements are the balance sheet, income statement, and the statement of cash flows. A foundational method of accounting that requires every transaction to be recorded in two different accounts. For every increase, there is a decrease; for every debit, there is a credit. This “double-check” helps to expose errors and keep the basic accounting equation in balance.

BOOKS AND FORMS USED

While there are certain similarities and overlaps between the two, there are distinctions that set these two roles apart. Bookkeepers don’t necessarily need higher education in order to work in their field while accountants can be more specialized in their training. Because bookkeepers tend to work for smaller companies, they may not be paid as much as accountants. Knowing the differences between the two can help people find their niche in the industry and can give guidance to companies on who to hire for their needs. As an accountant, you must pay attention to figures and financial details, but it is more essential to possess sharp logic skills and big-picture problem-solving abilities. While bookkeepers make sure the small pieces fit correctly into place, accountants use those small pieces to draw much more significant and broader conclusions about a company’s finances.

As there are a number of disbursements for office help,
advertising, telegraph, etc., that should be kept separate from the
general cash, it is very desirable to establish an office cash fund. This account may be as large as is required
for the purpose, the terms accounting and bookkeeping are interchangeable and when the office cash becomes depleted, more is
drawn which can be added to the account. At the end of the month,
a statement is made of the totals of the different columns which should
be a duplicate of the office disbursement sheet.

SPECIAL ACCOUNTING FORMS

That’s why accuracy is necessary but not sufficient for good bookkeeping. Bookkeepers also need to use consistent account categories, provide context for anything unusual, and break out the details of potentially misleading transactions. For a long-term career, accounting offers much more upward mobility and income potential.

A general ledger is a record of a company’s transactions over a period of time that documents changes to revenue, expenses, equity, liabilities, and assets. Credit is the agreement where a borrower receives something of value and repays the debt at a later date, often with interest. It also is a bookkeeping entry that either increases liability and equity or decreases assets on a business’s balance sheet. The single-entry bookkeeping method is often preferred for sole proprietors, small startups, and companies with unfussy or minimal transaction activity. The single-entry system tracks cash sales and expenditures over a period of time.

Each package should bear a number or other
mark by which it can be identified as belonging to a particular shipment. Commission or brokerage is the business of buying and
selling goods for another. The commission merchant or broker acts
in the capacity of agent, charging a stated per cent or commission
for his services. This account is charged with the
45entire cost of packing goods for shipment. It includes such items
as wages of shipping clerk and his assistants, crates, lumber, boxes,
and all other packing materials. When statements of the other ledgers have been made and
proved correct, a trial balance of the general ledger is made.

We’ve got a few actionable accounting hacks for you. For some advice on keeping those ledgers in order, check out these hacks for small business bookkeeping. Even before money flowed through the world, barter and trade transactions were recorded. In ancient Mesopotamia, when things of value exchanged hands, people marked these trades with clay tokens. To qualify for the title of an accountant, generally an individual must have a bachelor’s degree in accounting.

Extra short clears in lots of fifty thousand or twenty-five
thousand pounds, under the Rules of the Association, to confirm such transaction
by sending to the clearing house a memorandum of the same by 6
o’clock P. It shall be the duty of the clearing
house manager to assort and have ready for delivery by 8 o’clock A. Of
the following day, and to deliver, on application, all envelopes containing
such memoranda as are left with him in compliance with this section. A has bought 50,000 bushels of wheat of B, and has sold 50,000
bushels to C. By inquiry, it is found that C has sold 50,000 bushels
to B. By the adjustment
between the different parties of the difference in price, the necessity
of margining by A, B, or C is rendered unnecessary.

• By pressing his tabulator stop after writing
  273a name or figure, the machine would immediately jump to the next
  printing point on the line.
• This book is most convenient when kept in loose-leaf form, as
  a small number of leaves may be kept in the binder for current use,
  and after the sheet is filled, it may be filed away for future reference.
• Instead of a search through all postings to sales ledger accounts,
  it is only necessary to check postings to that particular section.
• Each account will also be linked to a mode of payment.
• Though they can assist with a wide range of problems depending on their unique expertise, they always serve in some strategic advisory capacity.
• As an illustration take a sales ledger which is subdivided into two or
  more parts, with special columns in cash book and sales book, and
  controlling accounts for each section.