Definition of Bookkeeping
Bookkeeping includes the recording, storing and retrieving of financial transactions for a business, nonprofit organization, individual, etc.
Examples of Bookkeeping Tasks
Typical financial transactions and tasks that are involved in bookkeeping include:
- Billing for goods sold or services provided to clients
- Recording receipts from customers
- Verifying and recording invoices received from suppliers
- Paying suppliers
- Processing employees' pay and the related governmental reports
- Monitoring individual accounts receivable
- Recording depreciation and other adjusting entries
- Providing financial reports
Today bookkeeping is done with the use of computer software. For example, QuickBooks (from Intuit) is a low-cost bookkeeping and accounting software package that is widely used by small businesses in the U.S.
Bookkeeping requires knowledge of debits and credits and a basic understanding of financial accounting, which includes the balance sheet and income statement.