Accounting. Online Accounting Help. Online Accounting. Online Accounting System. History of Accounting. General Accounting

Banking Activities as Controls

Banks are used by most companies for many different services. One of their most important services is helping companies control cash and cash transactions. Banks safeguard cash, provide detailed and independent records of cash transac­tions, and are a source of cash financing. (more…)

Periodic Inventory System

A periodic inventory system requires updating the inventory account only at the end of a period to reflect the quantity and cost of both goods on hand and goods sold. It does not require continual updating of the inventory account. The com­pany records the cost of new merchandise in a temporary expense account called Purchases. (more…)

Recording Prepaid Expenses in Expense Accounts.

We explained that prepaid expenses are assets when they are purchased and are recorded with debits to asset accounts. Adjusting entries transfer the costs that expire to expense accounts at the end of an accounting period. (more…)

Correcting Errors.

If errors are discovered in either the journal or the ledger, they must be corrected. Our approach to correcting errors depends on the kind of error and when it is discovered.

If an error in a journal entry is discovered before the error is posted, it can be corrected in a manual system by drawing a line through the incorrect informa­tion. (more…)