Mastering Tricky Situations
In This Chapter
Making journal entries: Where there’s a debit, there must be a credit
Recording new bank loans and loan repayments
Supporting the consumer economy (and recording hire purchase debt)
Tweaking the bottom line (whose bottom?) with expense adjustments
Matching income against expenses
The line between what an accountant does and what a bookkeeper does is a grey one. Some bookkeepers only do the bare minimum and leave the accountant to do the rest. Other bookkeepers prepare accounts that are damned near perfect, and all the accountant does is double-check the entries and make a few final adjustments.
This chapter is for bookkeepers who fall into the damned near perfect category, or even the completely perfect category: Bookkeepers who are ahead of their game and who want to create a set of accounts that’s as clean as a whistle. I talk about the very trickiest transactions that a bookkeeper encounters, such as how to record new loans, figure out hire purchase entries, make adjustments for prepaid expenses, journal provisions for employee leave, and a lot more.
Keen to hone your skills to a razor-sharp edge? Then read on . . .
Recording Journal Entries
Most of the transactions I describe in this chapter don’t involve a bank account, and instead involve a general journal, which is a special kind of journal, typically an adjustment, that transfers amounts from one account to another. If you use handwritten books or a spreadsheet, ...