Introduction to Accounting Systems

This screen is designed to give a brief overview of Accounting concepts and common practices. A general understanding of some basic accounting will make working with the Financials application easier and more intuitive.

What is Accounting

The purpose of accounting is to track the financial condition of a company, by recording and analyzing the following conditions:

• How much money do customers owe the our company?
• How much do we owe other people (vendors, employees, etc.)?
• How much of our product did we sell?
• How much did the product cost our company?
• Did we make or lose money?
• How much "cash" do we have left?

Bookkeeping

Bookkeeping is the practice of recording every financial transaction of a person or company. There are some basic bookkeeping terms that are standard in accounting and used by the Financials application.

• Ledgers - All transactions are recorded in a ledger, which derives its name from the physical books that were used before computers.
• GL (General Ledger) Account - The GL Account is a consolidated ledger that applies to everything in the company.