Business and Accounting Basics

The primary keyword discounts allowed refers to the price reductions offered by a seller to a customer to encourage early settlement of an outstanding debt. This technical guide explains the critical distinction between cash discounts and trade discounts, providing clear instructions on double-entry recording within the nominal ledger. For parents …

The 7 Journals in accounting serve as the primary books of original entry for categorising and recording business transactions before they are posted to the ledger. Understanding how to distinguish between cash, credit, and non-monetary activities is essential for maintaining accurate financial records and ensuring the integrity of the accounting …

Ledger accounts represent the third stage of the accounting cycle, providing a systematic method for categorising and recording financial transactions from journals into specific accounts. This comprehensive guide facilitates the transition from books of prime entry to the General, Sales and Purchases ledgers. Readers will understand the technical T-account format, …

Liabilities are the financial obligations a business owes to external parties, classified as either non-current or current based on their repayment terms and credit balance status. In the dual-entry accounting system, an increase in a liability is recorded on the credit (right) side of a ledger, while a decrease is …

The Cash Book is a fundamental book of original entry used to record all transactions involving cash, cheques and bank transfers within the accounting cycle. This essential financial record serves as a primary tool for monitoring a business’s most liquid assets and evaluating its ability to settle liabilities. By employing …