Category: Bookkeeping

The primary aim of the double-entry system is to keep track of debits and credits and ensure that the sum of these always matches up to the company assets, a calculation carried out by the accounting equation. It is used to transfer totals from books of prime entry into the nominal ledger. Every transaction is…

Only the final three columns debit, credit, and balance include monetary amounts. For this reason the format shown is referred to as https://www.bookstime.com/articles/bookkeeping-seattle a 3 column general ledger. For this reason the ledger is sometimes known as the book of final entry or the book of secondary entry. What is a general ledger? By consolidating…

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Contra Asset Account – A contra asset account is an asset that carries a credit balance and is used to decrease the balance of another asset on the balance. Examples include accumulated depreciation, sales returns and allowances, and contra equity accounts like treasury stock. Contra account accounting plays a crucial role in financial accounting by…