Royalties in Accounting

Royalty accounts are used to record royalties paid by a licensee to a licensor for the use of a long term asset owned by the licensor.

Royalties in Accounting April 19th, 2017Team
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Internal Control Procedures for Accounts Receivable

Internal controls for accounts receivable are used to reduce the risk of fraud and error in the accounts receivable process. The purpose of the accounts receivable internal control checklist is to ensure that valid sales invoices are properly recorded and that customers pay promptly.

Internal Control Procedures for Accounts Receivable January 20th, 2017Team
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Accounts Payable Internal Controls

Internal controls for accounts payable are used to reduce the risk of fraud and error in the accounts payable process. The purpose of the internal controls is to ensure that only valid supplier invoices are paid.

Accounts Payable Internal Controls January 17th, 2017Team
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Accounting Internal Controls

Internal controls in accounting are used to reduce the risk of fraud and error in the bookkeeping and accounting system. The level of internal controls used will depend on the nature and size of the business involved.

Accounting Internal Controls January 6th, 2017Team
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Accounts Payable Control Account

The accounts payable control account is an account in the general ledger which maintains summary postings relating to accounts payables. The account, which is sometimes referred to as the purchases ledger control account, is used to allow the detail of supplier transactions to be kept in a separate subsidiary personal account ledger which is not part of the double entry bookkeeping system.

Accounts Payable Control Account December 1st, 2016Team
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Accounts Receivable Control Account

The accounts receivable control account is an account in the general ledger which maintains summary postings relating to accounts receivables. The account, which is sometimes referred to as the sales ledger control account, is used to allow the detail of customer transactions to be kept in a separate subsidiary personal account ledger which is not part of the double entry bookkeeping system.

Accounts Receivable Control Account December 7th, 2016Team
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11 Users of Accounting Information

Who are the users of management accounting information? The users of accounting information are numerous and varied and include managers, owners, and investors each of which uses the information for a different purpose.

11 Users of Accounting Information January 24th, 2017Team
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Accounting Transaction Analysis

Accounting transaction analysis is part of the accounting cycle, and is the name given to process involved in using information from accounting source documents to firstly identify whether the transaction is an accounting transaction, and then applying the basic bookkeeping rules of debit and credit to break down the transaction into its component parts.

Accounting Transaction Analysis November 6th, 2016Team
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Accounting Assumptions

Financial statements are multipurpose documents used by many different parties for different reasons. For this reason financial statements need to be based on a generally agreed accounting framework or structure so that all parties understand how they are produced. Accounting assumptions can be considered to be the foundations on which the framework is based.

Accounting Assumptions November 6th, 2016Team
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Subsidiary Ledgers in Accounting

When a business has only a small number of accounting transactions then the double entry bookkeeping postings can all be maintained in a single ledger.

As the business expands the number of transactions and accounting staff increases and it becomes impractical to maintain one ledger due to its large size, and the problems of access to the ledger by multiple staff.

The solution is to sub-divide the ledger by accounting function into sales, purchase, cash book, and general ledgers.

Subsidiary Ledgers in Accounting February 15th, 2017Team
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Control Accounts

In a small business the accounts can be kept in one accounting general ledger and a trial balance can be extracted from that ledger. In a larger business, where the transactions are too many to be managed by one person, subsidiary ledgers such as the accounts receivable ledger (sales ledger) and the accounts payable ledger (purchase ledger) will be opened.

Control Accounts November 28th, 2016Team
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Accounting Errors

Accounting errors can occur in double entry bookkeeping for a number of reasons. Accounting errors are not the same as fraud, errors happen unintentionally, whereas fraud is a deliberate and intentional attempt to falsify the bookkeeping entries.

An accounting error can cause the trial balance not to balance, which is easier to spot, or the error can be such that the trial balance will still balance due to compensating bookkeeping entries, which is more difficult to identify.

Accounting Errors November 6th, 2016Team
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