Chapter 2

Getting Down to Bookkeeping Basics

In This Chapter

arrow Keeping business records

arrow Navigating the accounting cycle

arrow Choosing between cash-basis and accrual accounting

arrow Deciphering double-entry bookkeeping

All businesses need to keep track of their financial transactions — that’s why bookkeeping and bookkeepers are so important. Without accurate records, how can you tell whether your business is making a profit or taking a loss?

In this chapter, I cover the key parts of bookkeeping by introducing you to the language of bookkeeping, familiarizing you with how bookkeepers manage the accounting cycle, and showing you how to understand the most difficult type of bookkeeping — double-entry bookkeeping.

Bookkeepers: The Record Keepers of the Business World

Bookkeeping, the methodical way in which businesses track their financial transactions, is rooted in accounting. Accounting is the total structure of records and procedures used to record, classify, and report information about a business’s financial transactions. Bookkeeping involves the recording of that financial information into ...

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