Building Blocks of a Bookkeeping System
Part of the Bookkeeping For Dummies Cheat Sheet (UK Edition)
The following elements make up the essential foundations of bookkeeping. Keep these business basics in mind when you set out to create a bookkeeping system:
Chart of Accounts: Lists all accounts in the books, and is the road map of a business's financial transactions
Sales Ledger: Lists all the customer accounts, showing sales invoices, credit notes and receipts for each customer.
Purchase Ledger: Is a list of all your supplier accounts, including purchase invoices, credit notes and payments made to suppliers.
Cash book: This is where you will record all the bank and cash payments and receipts for the business.
Nominal Ledger: The book that summarizes all of a business's account transactions