Bookkeeping

Bookkeeping (also book-keeping or book keeping) is the recording of all financial transactions undertaken by an individual or organization. The organization may be a business, a charitable organization or even a local sports club. Bookkeeping is "keeping records of what is bought, sold, owed, and owned; what money comes in, what goes out, and what is left." [1] A financial transaction is any event that involves money.
Individual and family bookkeeping involves keeping track of income and expenses in a cash account record, checking account register, or savings account passbook. Individuals who borrow or lend money track how much they owe to others or are owed from others.
Bookkeeping may be performed using paper and a pen or pencil. With increasing complexity in tax regulations and to minimize calculation errors, many organizations use accounting software.
Two common bookkeeping methods used by businesses and other organizations are the single-entry bookkeeping system and the double-entry bookkeeping system. Single-entry bookkeeping uses only income and expense accounts, recorded primarily in a "Revenue and Expense Journal". Single-entry bookkeeping is adequate for many small businesses. Double-entry bookkeeping requires posting (recording) each transaction twice, using debits and credits.[2]
A bookkeeper (or book-keeper), sometimes called an accounting clerk in the United States, is a person who records the day-to-day financial transactions of an organization.[3] A bookkeeper is usually responsible for writing up the "daybooks." The daybooks consist of purchase, sales, receipts and payments. The bookkeeper is responsible for ensuring all transactions are recorded in the correct daybook, suppliers ledger, customer ledger and general ledger. The bookkeeper brings the books to the trial balance stage. An accountant may prepare the profit and loss statement and balance sheet using the trial balance and ledgers prepared by the bookkeeper.

Single account bookkeeping
Simple bookkeeping for individuals and families involves recording income, expenses and current balance in a cash record book or a checking account register.
Sample checking account register (United States, 2003)[4]
¤AD-Automatic Deposit ¤AP-Automatic Payment ¤ATM-Teller Machine ¤DC-Debit Card
NUMBEROR CODE
DATE
TRANSACTION DESCRIPTION
PAYMENT AMOUNT
/
FEE
DEPOSIT AMOUNT
BALANCE
balance forward
1331
85
AD
3/15
paycheck
1823
56
3155
41
AP
3/26
electricity
104
31
3051
10
704
3/26
car registration
58
50
2992
60
ATM
3/30
cash withdrawal
100
00
1.00
2891
60
DC
4/2
groceries
127
35
2764
25

Single-entry bookkeeping
The primary bookkeeping record in single-entry bookkeeping is the Revenue and Expense Journal, which is similar to a checking account register but allocates the income and expenses to various income and expense accounts. Separate account records are maintained for petty cash, accounts payable and receivable, and other relevant transactions such as inventory and travel expenses.
Sample revenue and expense journal for single-entry bookkeeping[5]
No.
Date
Description
Revenue
Expense
Sales
Sales Tax
Services
Inventory
Advert.
Freight
Office Suppl
Misc
7/13
Balance forward
1,826.00
835.00
1,218.00
98.00
510.00
295.00
245.00
150.00
83.50
61.50
1041
7/13
Printer- Advert flyers
450.00
450.00
1042
7/13
Wholesaler - inventory
380.00
380.00
1043
7/16
office supplies
92.50
92.50
--
7/17
bank deposit
1,232.00
- Taxable sales
400.00
32.00
- Out-of-state sales
165.00
- Resales
370.00
- Service sales
265.00
bank
7/19
bank charge
23.40
23.40
1044
7/19
petty cash
100.00
100.00
TOTALS
3058.00
1,880.90
2,153.00
130.00
775.00
675.00
695.00
150.00
176.00
184.90

Double-entry bookkeeping
Footing
Footing and Cross-footing are bookkeeping terms for summing a table of numbers by column and by row, respectively. In British English, the terms casting and cross-casting are used.

Computerised bookkeeping.
Computerised bookkeeping removes many of the "books" that are used to record transactions and enforces double entry bookkeeping. Computer software increases the speed at which bookkeeping can be performed.

Online bookkeeping
Online bookkeeping allows source documents and data to reside in web-based applications which allow remote access for bookkeepers and accountants. Typically, a company scans its business documents and uploads them to a secure location or into an online bookkeeping application on a regular basis. This allows the bookkeeper to work remotely with these documents to update the books. Users of this technology include
mobile employees scanning and sending in their receipts and bills while on the road to get reimbursed more quickly.
organizations with multiple offices centralizing their accounting department and having the documents sent to this location online.