Book-keeping is the art of recording the transactions on the books of original entry and the ledgers. This work is usually performed by junior clerks who are sometimes called book-keepers of accounts clerks. This work is more or less of mechanical nature and does not require any specialized knowledge of the principles of accountancy. The work of such clerks is supervised by a man who is called an Accountant.
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- Subsidiary ledger
A subsidiary ledger that collects transaction data of individual creditors. Companies use subsidiary ledgers to keep track of individual balances.
- The ledger
The ledger is the entire group of accounts maintained by a company. The ledger keeps in one place all the information about changes in specific account balances.
- Cost method
Cost method is an accounting method in which the investment in common stock is recorded at cost, and revenues are recognized only when cash dividends are received.
- Consistency principle
Consistency principle dictates that a company uses the same accounting principles and methods from to year. Consistent application enhances the comparability...
- Bad debts expense
Bad debts expense is an expense account to record uncollectible receivables. Individuals may be laid off from their jobs or faced with unexpected hospital bills.
- Land improvements
Land improvements are structural additions made to land. Examples are drive ways, parking lots, fences, landscaping, and underground sprinklers.
- Return on assets
Return on assets is an overall measure of profitability computed by dividing net income by average assets.