Accounting 101: Accounting Basics for Beginners to Learn

This focuses on the use and interpretation of financial information to make sound business decisions. It’s similar to financial accounting, but this time, it’s reserved for internal use, and financial statements are made more frequently to evaluate and interpret financial performance. Accounting is the process of recording, classifying and summarizing financial transactions. It provides a clear picture of the financial health of your organization and its performance, which can serve as a catalyst for resource management and strategic growth. When performing accrual accounting, a double-entry accounting system is highly recommended.

When you use accounting software technology instead of spreadsheets and manual data entry, you’ll save time on accounting tasks in the long run and have peace of mind that your books are balanced. If you’re not sure which accounting process you should use, talk to a certified public accountant or other small business accounting professionals. If you don’t have a tax professional, ask your in house accountant or another small business owner for a referral. An accounting firm that specializes in helping small businesses can be an invaluable resource.

Business accounting basics

Since your bank accounts are linked with QuickBooks, there is no need for you to manually enter your data. Manual calculations, accounting rules and formulas are all taken care of for you and financial reports are available at the click of a button. After you enter a transaction and categorize it under an account, your accounting business accounting software will create a journal entry behind the scenes. Most modern accounting software uses the double-entry accounting system, which requires two book entries — one debit and one credit — for every business transaction. Taking online courses can be a great way to learn the basics of accounting for your business.

You select one, customize it by using the filter and display options provided, and let the software pour your company data into it. Depending on how long your business has been operating, getting started with a small business accounting service can take anywhere from five minutes to several hours after signing up for an account. Most offer free trials or a demo account and charge monthly subscription fees once you’re ready to commit. Generally speaking, the more you need from an accounting service, the longer it takes to set one up and the higher the monthly payment. The user experience was clearly designed for novice bookkeepers who are just starting out, or for established but still small companies that just don’t need many accounting features.