Clear And Unbiased Facts About Double Entry Accounting Software
Every financial transaction has two parts – debit and credit. Each transaction whether cash basis or Accrual basis. When the amount is transferred the account is called debit, and when the amount is taken from the account is called credit. At the day end, these amounts have to be accounted for the balanced. Every transaction has the sum of debits equal to the sum of credits. This is called double-entry Accounting.
Meanwhile, you can use excel spreadsheet to do your double-entry accounting. In the Excel sheet there are specific built-in software programs but after the revolution in accounting software, excel is limited to use. Double entry accounting software is to do faster and more effective than excel sheet.
Most of the time implementation can be the bigger issue of the buyer of software. In many cases vendor is not support properly its development and consultancy. Most of the time reseller generally passes on a license fee to the software, seller and then price the buyer for installation, customization and support services. The buyer normally can be payee 60 to more than 200% of the value of the software maintenance and consultancy fees.
Those who are needed to use personal finance software, Double entry accounting software for personal finance is to use as open source software in an online but there has paid version also.
On the other Those who have needed small business software, they can use double entry accounting software for small business is available to an online and paid version also.
Example of daily transactions
Some examples of Double-entry Accounting transaction which occurs daily in your business are given below:
- Purchasing heavy machinery with cash would show a debit for the machinery and a credit for the cash that means assets is decreased.
- Receiving interest from fixed deposit money into a bank account which results in debit for the cash received and a credit for investment income that means income is increased.
- Issuing ordinary shares on the behalf of business for cash which would result in a debit for the cash received which would increase assets and a credit is share capital for increasing equity.
- Receiving bank loan, a loan would be a debit for the cash received and it shows an increase in assets, on the other hand, a credit would be to the bank loan account and it refers that, an increase in liability.
- Electricity bill to be paid which it would be entered as a debit in utility expense and it states that in an increase in expense in addition to a credit to cash and result would be a decrease in assets.
Although it would be clear-cut, these entries may become increasingly complex when more than two accounts are involved. When you are starting a business and record your business transaction on a daily basis, preparing financial position in fiscal years. It seems to be maintaining details like as chart of accounts.
Easy to Use
Mostly accounting software provides a good service for these types of typical accounts that may help to build your business. Nowadays, software is a blessing to use in the business organization.
Thumbs up to accounting software, it is done all transaction automatically. When you put your daily transaction in the software as a data it is done automatically. In addition to this is also a great labor and time-saving. Whatever you are entering as an amount in this software is to be generated these entries as a sales invoice or a bank paid. There are many benefits to operating Double Entry Accounting under using accounting software Preparing financial statement, cash flow statement, journal entries, ledger accounts, Bank reconciliation statement and other accounts which are related to double entry accounting. This is suitable for using in a small business, personal business, a non-profit organization, church and Industrial factory also. There has been given some software name which is free from online and also you have liked to use paid version what you have needed.
Some free or open source accounting software mentioned below for small business, personal finance, a non-profit organization, church and Industrial factory:
- Money manager EX
- Turbo cash
- Post book
- Guna Accounting
- Home Bank
- Personal Finance
Some paid software mentioned below for dual entry accounting;
- Home Accounts
- ABC6 Accounting software
- Quick Book pro
- Home Accounts 4
- GNU Cash- personal and small business software
- Sage 50 Accounts 2016 in easy steps