At times, having bookkeeping as a profession can be very daunting, but it is not all bad. There are some interesting and fun facts about bookkeeping and accounting that can keep you inspired and motivated for the job. Indeed, bookkeeping is not always a noticeable thing when people talk about exhilarating jobs, but with the help of the following facts, you are bound to be amazed by this career.
Reasons for Bookkeeping
Bookkeeping is the name of the recording, saving and recovering financial statuses of small/large businesses, charitable organizations and an individual himself. Bookkeeping can help in the transactions that involve billing for company facilities, payments to suppliers, documentation of receipts from the customers, processing payroll of employees, keeping a record of all the authentic invoices and monitoring of receivable accounts.
Bookkeeping Is Different From Accounting
Any business needs to have both accounting as well as bookkeeping, but these two terms are far more different than each other. In accounting, the accountants do analyzation, classification, and interpretation of the company’s statistics while in bookkeeping; a record of financial transactions is made. Bookkeepers like Xero bookkeeping services sunshine coast are in charge of handling and recording all the aspects of an accounting procedure which an accountant cannot.
Kinds of Bookkeeping Systems
There are two basic types of bookkeeping system, i.e. single-entry bookkeeping and double-entry bookkeeping system.
The single bookkeeping system is mainly used by those people who own small businesses and have no complications in their day-to-day money transactions. They can use this system to maintain their company’s expenses along with cash sales that are remunerated when the owner earns it. A sales journal is usually maintained by the bookkeeper where he encloses details about sales, bank statements, profit, loss, and information about due payments. It is recommended not to use this system if a company has accounts receivable or payable and a huge amount of investment.
On the other hand, a double-entry bookkeeping system requires the entry of single transactions in the form of income. After the first entry, a second entry is formed to trace out transactions to the corresponding party.
Many business owners are now taking advantage of bookkeeping software that is available commonly. Most of this software performs double-entry bookkeeping, so the person behind the screen is not supposed to have complete command over the method.