What are the different types of simple books?

Simple books are used in businesses to monitor tides and documents and cash outflows. Leader Ledgers separates the balances and accounts of assets and liability to debit and credits. Sub-Sedgers describes in detail transactions that directly affect your account balance such as receivables. Cross are sometimes referred to as T accounts, because all transactions that affect the balance of the debit must balance or compensate for transactions that affect credit balances. For example, if the company buys an inventory on a loan, a debit is recorded in the amount of inventory purchase. The corresponding credit record will be made for the same amount that shows that the balance is owed on the invoice or credit line. These quantities are eventually used to calculate the end balance of the account, which can then be converted to one of the types of simple books.

The term T-account is used to describe the process of sorting debit and credit transactions. The name is derived from how transactions are represented: a line reminiscent ofWell "T" is drawn on paper, with the amounts of the debit record on the right and credit amounts recorded on the left. Each transaction contains debit and credit sub-ledger. For example, a payment made on an invoice would result in a debit or a reduction in a cash account and a credit or raise the account.

For groups of transactions that relate to each other, the chassis is created. Sub-dogers are a way to help simplify the financial statements of the company. They reflect whether the account balance has increased or decreases during the accounting period, which may usually take three months, six months or year. For example, in the case of receivables, the amount may balance whether the company has problems with the collection of money owed to the inventory that has already been sold.

Sub-ledger end balances are converted to main books. These types of simple books are a summary of the origin of the entire debit and credit balance of societyCentacle. The main book does not give specifics to account balances. For example, the "sale" account will be the only balance and is a total of all sales generated by the Company for this accounting period.

General books are also known as the "final record". Simple books contain values ​​that will be used to create the balance sheet, profit statement and loss and cash flow statement. Careful records in simple books can be particularly useful if the time for the construction of the balance sheet comes, as the assets of the company must equal to its obligations plus its own capital.