Define in own words CHAPTER 5 – Accounting Systems Accounting system Accounts payable subsidiary ledger Accounts...

Define in own words

CHAPTER 5 – Accounting Systems

Accounting system
Accounts payable subsidiary ledger
Accounts receivable subsidiary ledger
Cash payments journal
Cash receipts journal
Controlling account
e-Commerce
General journal
General ledger
Internal controls
Invoice
Purchases journal
Revenue journal
Special journals
Subsidiary ledger

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Expert Solution

1) Accounting system:- An accounting system is the system used to manage the expenses, income, and other activities which are related to finance of a business. All types of financial transactions are tracked by accounting system. It manages the expenses, invoices and funding .

2)Accounts payable subsidiary ledger:- The subsidiary ledger is an account book that track number of suppliers that the business owes, and the expenses of business.This shows the transaction history of a business and the amount of current and outstanding accounts payable And amount of its suppliers.

3)Accounts receivable subsidiary ledger:- The ledger shows payment history of each customer and the transaction to whom the business extends credit. All sales made on credit by business are recorded in it.this helps the company to track the customer transactions and payment made in their business.

4)Cash payments journal:- All the transactions related to cash payments on which you spend funds are recorded in this special journal . example, payment to creditor's , cash purchase, cash expenses (salary) etc .It includes outflow of cash.

5)Cash receipts journal:- this journal is opposite to cash payments journal because it records the transaction of inflow of cash . It keep track of the sales of items when cash is received . Examples:- reciept of cash from cash sales , reciept of cash from credit customers .

6) Controlling account:- It includes all correct total amount without any details. It is neat and clean journal ledger contain the corre Forward balance to used in financial statements.example, Accounts Receivable could be a control account in the general ledger. Each day the total of the day's credit sales and the day's collections are posted to this account. However, the details involving specific customers' accounts will be found in a subsidiary ledger.

7) e-Commerce:- buying and selling of goods by internet and transfer of money to execute the transaction is known as e- commerce . Here e stands for electronic.

8)General journal:- Each and every single transaction of the company of the whole year is recorded in this journal ( journal entries) . Firstly transaction will be recorded here after that goes in there particular ledger.

9)General ledger:- These ledgers are generally used to sort and summerize the company transactions.General Ledger in simple language is grouping of transactions of similar nature. An organization has multiple transactions in a day. Every transaction leads to two entries as per the double entry system of bookkeeping. These entries are then posted in respective accounts called ledgers.

10)Internal controls:- It is the process of assuring the objectives of aan organisation .It is a means by which an organization's resources are directed, monitored, and measured. It plays an important role in detecting and preventing fraud and protecting the organization's resources, both physical (e.g., machinery and property) and intangible (e.g., reputation or intellectual property such as trademarks).

11) invoice:- It is a type of document that itemizes and records a transaction between a seller and a buyer . It includes all the information regarding to the mode of payment , items sold , date of sale etc .

12) purchase journal:- All the purchases on credit are recorded in this journal .

13o revenue journal:- it tracks all the transaction which includes the revenue ( sales) of the company.

14) Special journals:- The journals which are made for the special entries of the transaction like puchase journal to record all credit purchase at one place to make things easy to find and understand .it means they have there special names to track the particular journal example sales journal:- records all credit sales ,cash receipts journal to record all cash receipts etc .

15) Subsidiary ledger:- In this ledger it have details to support a general ledger control account. For instance, the subsidiary ledger for accounts receivable contains the information for each of the company's credit sales to customers, each customer's remittance, return of merchandise, discounts, and so on. With these details in the subsidiary ledger, the Accounts Receivable account in the general ledger can report summary amounts .

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