Recent Articles

Accounts Payable

Accounts payable are amounts due to vendors or suppliers for materials and services received. It is located in the current liabilities section of the balance sheet.

Bookkeeping – Tracking Cash (Lesson 46)

02/24/2017

Of all the assets in business cash is the most valuable and coveted.   Keeping track of how much is available and where it goes is the responsibility of the bookkeeper.   Often owners have no idea of how much they really have nor how much of the [...]

Bookkeeping – Accounts Payable Management (Lesson 43)

02/18/2017

With small business the biggest hearache for the bookkeeper is addressing the daily phone calls and letters (bills, statements and notices) related to purchases.   Vendors regulary communicate with the accounts payalbe manager wanting to know [...]

Bookkeeping – Cash or Accrual (Lesson 25)

01/20/2017

Generally Accepted Accounting Principles (GAAP) advocates using the accrual basis of accounting over cash basis.   The difference between the two methods is important to understand as a bookkeeper. In general, cash basis focuses on the bank [...]

Accounts Payable Turnover Rate (Ratio)

11/04/2016

The accounts payable turnover rate is a business activity ratio measuring the frequency of the company’s ability to pay its vendors and suppliers.  The numerical value is customarily reported as an annual value.  The higher the number, the [...]

Control Accounts in Accounting

06/08/2015

Accounting uses accounts to sum up activity related to a particular function of business.  As an example the bank account has a register which identifies the activity in a ledger format of what transpires at the bank for this particular account.  [...]

Current Liabilities Section of the Balance Sheet

12/10/2013

The current liabilities section of the balance sheet identifies those amounts due to third parties within the current year.  These include accounts payable, credit card accounts, accrued payroll, taxes, unearned revenue, deposits and those amounts [...]

Create a File Structure for Accounting

01/18/2013

Creating a file structure for accounting is critical for the overall success of the business.  If properly structured, data retrieval and information access add to the overall value of the company.  This article teaches the new business owner how [...]

Cash Flow – A Basic Definition

01/16/2013

Cash flow is the ability of a business to turn its product or service into cash.  It is generally measured in dollars or in dollars against a time period.  The simplest example I can think of is a child selling lemonade.  The child purchases the [...]