Accounting Basics
Accounting Basics

Accounting Basics

Before you set up your company file and use QuickBooks for your financial recording, you need to understand the basic accounting terms. While bookkeeping is a fairly easy word, becoming acquainted with the different accounting terminology will help you understand how the day-to-day transactions relate to financials.

Accounting 101For intermediate and advanced training. A video to watch before you start learning.

In this section, you will explore different aspects of accounting and basic functions associated with lists. There are also some guidelines as to how to set up your financial reporting system using cash or accrual basis. QuickBooks produces basic financial reports, which you can use to gain an understanding of your company’s finances.

What Others Owe You vs What You Owe Others

Many people view invoices and bills as the same thing. The same can be said for Payment and Pay Bills. They certainly resemble each other however, in QuickBooks they refer to two different things.

Chart of Accounts

All companies should follow a systematic method of assigning account numbers to identify each account name, although it is not necessary to use numbers in QuickBooks. The Chart of Accounts is a list of all Assets, Liabilities, Equity, Income, and Expenses.

Cash vs Accural

Lists are the framework of QuickBooks. Use Lists to open and fill out most QuickBooks forms, such as writing a check or choosing the name of one of your Vendors from your Vendor List. QuickBooks fills in the name, mailing address, and account number on the check for you. This saves you time and reduces typing errors. If necessary, you can also change the information directly on the form.

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