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Intercompany accounting is the accounting process when transactions occur between two business entities with common ownership. Companies with common ownership include parent companies and subsidiary companies. Intercompany transactions arise when business transactions occur between entities that are not independent since control of both is held ...
A journal entry is the act of keeping or making records of any transactions either economic or non-economic. Transactions are listed in an accounting journal that shows a company's debit and credit balances. The journal entry can consist of several recordings, each of which is either a debit or a credit. The total of the debits must equal the ...
A chart of accounts (COA) is a list of financial accounts and reference numbers, grouped into categories, such as assets, liabilities, equity, revenue and expenses, and used for recording transactions in the organization's general ledger.
A general journal is a daybook or subsidiary journal in which transactions relating to adjustment entries, opening stock, depreciation, accounting errors etc. are recorded. The source documents for general journal entries may be journal vouchers, copies of management reports and invoices.
Accounting, also known as accountancy, is the process of recording and processing information about economic entities, such as businesses and corporations. [1] [2] Accounting measures the results of an organization's economic activities and conveys this information to a variety of stakeholders, including investors, creditors, management, and regulators. [3]
Each company keeps separate books. However, at the end of the year, a consolidation working paper is prepared to combine the separate balances and to eliminate [2] [3] the intercompany transactions, the subsidiary's stockholder equity and the parent's investment account. The result is one set of financial statements that reflect the financial ...
A Cash receipts journal is a specialized accounting journal and it is referred to as the main entry book used in an accounting system to keep track of the sales of items when cash is received, by crediting sales and debiting cash and transactions related to receipts. Sales on account are booked instead in the sales journal. [1]
The modern double entry system was likely a direct precursor of the first European adaptation many centuries later. [4] The first known use of the terms "debit" and "credit" occurred in the Venetian Luca Pacioli's 1494 work, Summa de Arithmetica, Geometria, Proportioni et Proportionalita (A Summary of Arithmetic, Geometry, Proportions and Proportionality).