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A label assigned to each account to indicate its classification. For header accounts, account type names are the eight account classifications. Detail accounts have multiple asset (Bank, Accounts Receivable, Other Asset) and liability (Credit Card, Accounts Payable, Liability, Other Liability) account types. Each of the other six classifications has just one account type, each named the same as the classification.
A label assigned to each account to indicate its classification. For header accounts, account type names are the eight account classifications. Detail accounts have multiple asset (Bank, Accounts Receivable, Other Current Asset, Fixed Asset, Other Asset) and liability (Credit Card, Accounts Payable, Other Current Liability, Long Term Liability, Other Liability) account types. Each of the other six classifications has just one account type, each named the same as the classification.
What you owe for goods or services delivered. The sum of all accounts payable is recorded as a liability account. Any time you record a purchase in the
Purchases command centre, the unpaid balance of the purchase is added to your accounts payable balance. Every time you pay a bill (using
Pay Bills in the
Purchases command centre), the amount is subtracted from your accounts payable balance.
What your customers owe you. The sum of all accounts receivable is recorded as an asset account. Any time you record a sale in the
Sales command centre, the unpaid balance of the sale is added to your accounts receivable balance. Every time you enter a customer payment (using the
Sales command centre), the amount is subtracted from your accounts receivable balance.
Entries in the Bank and Deposit Adjustments window to account for details that would prevent a bank reconciliation if omitted. An example is a fee charged by a credit card processor.
Inventory adjustments change an item’s quantity to match the actual quantity on hand, or to change the unit cost. An inventory adjustment changes the item’s total value.
Time billing adjustments change an activity slip’s billable amount without affecting the record of the hours or units that were actually worked, or changing the rate usually charged for an activity.
The user ID that has access to the entire company file. The Administrator ID is created automatically upon creation of the company file. The Administrator must assign a user ID to every other person who uses the system; no other user is authorized to create other user IDs.
Things you own. Your bank account and computer are both assets. If someone owes you money, the total owed to you is an asset.
Current assets are assets that can be turned into cash within a relatively short period of time (less than a year). Things that take longer to turn into cash, like your factory building, are called
fixed assets.
Information captured by the accounting system to track how each transaction affected every account balance, who performed the processing, and so on. The Audit Trail Tracking System security preference activates a tracking system that records and reports certain entries and many changes performed to a company file.
The average cost method to value an inventory item. That is, the total cost of all your purchases for a particular item currently on hand divided by the number of items on hand.
A financial snapshot of a company’s position at a particular time. A balance sheet lists the balances of the company’s asset, liability, and equity accounts. It is called a balance sheet because the total value of the asset accounts minus the total value of the liability accounts always equals the total value of the equity accounts.
A 1, 6, 10, 12, 15, or 30 minute measure that you define in the
System tab of the
Preferences window for use in time billing for hourly activities, rather than whole hours. Whether or not you use billing units, timesheets and time billing invoices will display your billable units as whole hours.
A category is an entity for grouping transactions. A category can be a department, profit centre, geographic division or any other subset of your business that requires separate reporting.
An accounting period in which all entries are completed. AccountEdge software does not require that you actively close a period. However, in the
Preferences window you can prevent accidental posting to a closed (locked) period.
A file comprising all your company’s financial information such as business name, contact information, accounts, and account transactions. You can use your accounting software for 30 days in trial-mode. After this time, you will be unable to enter any changes until the file is activated.
Found in the Setup menu, your company information contains your company’s name, address, tax information, and information about your company’s fiscal year.
This is an account that normally carries the opposite balance of the accounts of the same type. Assets, for example, normally have a debit balance; a common contra-asset account is the accrued depreciation of an asset. By using a contra account, you can show a company a car that’s worth $12,000, by listing the asset at its $15,000 purchase price followed by the -$3,000 balance of the accrued depreciation account.
The earliest month in the fiscal year for which transactions are to be recorded. If you purchase your accounting software in October but begin to record transactions dated from September 1, your conversion month is September. The conversion month determines the opening balances you will enter when you set up your company file.
Sometimes called ‘cost of goods sold’ this account type works just like an expense account. The only difference is where it appears on the profit & loss statement. Cost of sales accounts appear after your income accounts, but before your expense accounts. Cost of sales is subtracted from your income to produce gross profit, but your expenses are subtracted from your gross profit to produce net profit. You are not required to use cost of sales accounts.
An amount on the right side of the ledger. (Debit amounts appear on the left.) A credit amount increases the balance of accounts with a credit balance and decreases the balance of accounts with a debit balance. Accounts that normally carry a credit balance are liability, equity and income accounts.
A status that can be imposed on a customer’s account. This action may be taken if the currently past due amount reaches a certain amount or has existed for a certain period of time, even if the amount due does not exceed the credit limit.
Assets that can be turned into cash within a relatively short time (less than a year) are called current assets. Some of your current assets are your bank accounts, accounts receivable, and petty cash. Current assets usually do not lose their value over time. Current assets normally have a debit balance.
Current year earnings is an equity account. Its balance equals your income minus cost of sales and expenses. Current year earnings are zero at the beginning of a fiscal year. Current year earnings are kept as a running total as the fiscal year progresses. When you start a new fiscal year, the balance of the current year earnings account is reset to zero because the balance amount is moved into the retained earnings account.
When a customer returns goods they have paid for, you can create a credit transaction to cancel the original sale and record a return. A customer credit is usually an invoice recorded with a negative amount. A customer credit is also created when a customer’s account is overpaid. A customer credit is settled by writing a refund cheque or applying the amount to another open invoice.
A setting to indicate that the payment due date and early payment discount date are based both on the month after the transaction was recorded (after the End of Month) and the selections made in the Discount Date and Balance Due Date fields. For example, if a transaction was recorded in April with a discount date of the 1st and a balance due date of the 25th, a discount would apply if the balance was paid by May 1; the entire balance would be due May 25.
An amount on the left side of the ledger. (Credit amounts appear on the right.) A debit amount increases the balance of accounts with a debit balance and decreases the balance of accounts with a credit balance. Accounts that normally carry a debit balance are asset and expense accounts.
The means by which you send a form to a customer, employee, or vendor. The choices are
To Be Printed,
To Be Emailed,
To Be Printed and Emailed, or
Already Printed or Sent. For sales and purchases, you can assign a default status to a customer or vendor and change it for an individual sale or purchase.
The expense allocation of the cost of an asset over a period of time. Most accountants create a contra-asset account, such as
accumulated depreciation, to
track the depreciation of an asset. A typical depreciation transaction credits the contra-asset account and debits a depreciation expense account. Depreciation is most often recorded as a general journal entry.
A method of bookkeeping in which every entry is balanced by another entry. Correct double-entry accounting always provides a balanced set of books; that is, the total value of your asset accounts minus the total of your liability accounts should equal the total value of your equity accounts.
Your company’s costs of having employees. They are calculated on employees’ paycheques, but don’t affect the employees’ net pay; instead, they affect the amounts you must contribute to the employee, to the government, or to other institutions.
A location where one unit of information, such as the telephone number for a customer, is entered and displayed. Data fields can contain either information entered by a user or the results of a calculation performed by your accounting software. Text fields usually are labels for data fields.
The balance sheet and income (profit & loss) statement. The balance sheet is your company’s financial picture at a particular time. The income statement shows your company’s financial performance over a period of time.
The 12-month period you use to define your accounting year. Your accounting software does not require that it matches the calendar year. You are also provided an optional 13th period for making year-end adjustments that you do not want to affect a particular month.
A document used in day-to-day business, usually to accomplish transactions like sales and purchases. Typical forms include sales invoices, statements, purchase orders, and cheques. Payroll Tax Forms are official documents that are filed with the government. Documents such as labels, personalized letters, and packing slips are also considered forms.
This is where all your account information—sales, purchases, inventory, cash in, cash out—come together. You prepare your financial statements (balance sheet and income statement) from the general ledger information.
A job used for grouping jobs and organizing income, costs, expenses, and profit or loss in larger, more comprehensive categories than individual jobs. Reimbursable expenses cannot be tracked for header jobs and line items can’t be assigned as they can be with detail jobs.
The balance of an account prior to converting your records to accounting software. You are not required to enter historical balances. Enter them only if you wish to compare a current month’s activity to the activity for the same month last year.
Also called a profit & loss statement, the income statement shows your company’s performance over a period of time. An income statement begins with income. It then subtracts cost of sales to produce a gross profit. Expenses are subtracted from gross profit to produce operating profit. ‘Other income’ amounts are added to operating profit and ‘other expense’ amounts are subtracted from operating profit to produce net profit.
Raw materials, items available for sale, and items in the process of being made ready for sale. Most accountants record an inventory’s value in a current asset account. Inventory items are valued using the average cost method.
Things you owe. Your working capital loan is a liability. Your accounts payables is what you owe someone for a purchase, and are liabilities. Liabilities that are due within the next year are called current liabilities. When a liability is not due for more than a year, it is called a long‑term liability. Liabilities normally have a credit balance.
Your accounting software uses linked accounts to post your inventory, sales, and purchase transactions to the proper account. When, for example, you link your receivables account, you are telling your accounting software where to post the balance due from a sale.
Used when more than one person is entering information into the same company file at the same time to prevent different pieces of data from “colliding” into each other when they’re simultaneously entered into a company file; such a situation, if not prevented, could seriously damage the company file.
One of the special Excel and Word templates that are installed with your software. These are used to view reports in Excel or export data to personalized letters.
A setting that indicates that the payment due date and early payment discount date are based on the month when the transaction was recorded as well as selections made in the
Discount Date and
Balance Due Date fields. For example, if a transaction is recorded in April with a discount date of the 10th and a balance due date of EOM, a discount would apply if the balance were paid by April 10 and the entire balance would be due April 30.
The components of an employee’s paycheque. These are grouped into five payroll category types: wages, accruals, deductions, taxes, and employer expenses.
A function that lets you look at a journal entry before it is recorded. Recap transaction is particularly useful for those transactions, such as invoices and bills, for which the journal entry is not immediately obvious.
Money from previous years earnings that has been left in the company. At the end of a fiscal year any money earned (or lost) during the fiscal year is transferred to retained earnings. Retained earnings are recorded in an equity account.
A feature that ensures that only one user is using a company file during certain file maintenance tasks (such as backing up and chequing a company file for errors) that require the ’full involvement’ of the company file.
The price entered for the item in the Buying Details view of the Item Information window. You can change the price on the purchase, if you want. If you select the
Use Standard Cost as the Default Price on Purchase Orders and Bills option, it is the price that will appear automatically for the item when you enter a purchase.
A file format in which fields that are separated by tab spaces. Tab-delimited files can be opened in most word-processing and spreadsheet software, and can usually be used to import data into accounting software.
A report showing all the activity for an account or accounts within a selected date range. It shows the balance of the account at the beginning of the date range, the activity within the date range, and the balance at the end of the date range. A trial balance is useful for chequing your entries before performing your period-end processing.
The linked account into which individual cash-receipts transactions are recorded when not credited directly to chequing or credit card accounts. Amounts from individual transactions in the undeposited funds account are grouped together. When deposited, they are recorded as a single bank deposit transaction on the bank or credit card statement.
When you return goods to a vendor, you need to correct your records to record the return. To do this, you can create a vendor debit. A vendor debit is a transaction with a negative balance for the goods you returned. A vendor debit is also automatically created if you overpay your account. A vendor debit is settled by recording a vendor’s refund cheque or by applying the amount to another open bill for the same vendor.
An small arrow icon that enables you to view, or “zoom,“ to more detailed information about a specific card or transaction.
