Explain why Revenue and Expense Accounts are designated as Temporary or Nominal accounts

Tweet Below explained what accounts are known as temporary or nominal account: The increase in capital resulting from revenue is TEMPORARY, since capital will be reduced by expenses in the same period. These accounts are closed out at the end of the accounting period and the net balance ( for example, the excess of revenue […]

Why do businesses keep accounts?

Tweet In earlier article, we understand the terms: accounting,accounts & bookkeeping, next is what are the major reasons for keeping accounts?Some major reasons for businesses to keep accounts are as follows:- Keeping track of money by showing where it came from and how it has been spent By producing accounting information, these accounting records are […]

Explain the terms: Accounting, Accounts & Bookkeeping

Tweet The following terms are commonly used in the Accountancy profession:Accounting: which is the process of collecting, recording, summarizing and communicating financial information. whereas Accounts are the records in which this information is recorded. and Bookkeeping is the keeping of the most basic records { click here to the Content Page on Introduction to Accounting […]

Accounting Quiz or Test Your Accounting Knowledge On Income And Expenditure Accounts

Tweet Refresh or test your accounting knowledge on Income And Expenditure Accounts : QUESTIONS: 1.0    List three differences between the accounts of a non-trading organization and those of a business 2.0    List five sources of income for a non-trading organization 3.0    What is a receipts and payments account? 4.0    Describe two ways of accounting for income […]

Accounting Quiz or Test Your Accounting Knowledge On Partnership Accounts

Tweet Refresh or test your accounting knowledge on Partnership Accounts : QUESTIONS:1.0  What is “ joint an several liability? 2.0  Describe two ways in which the accounts of a partnership differ from those of a sole trader 3.0  What are the differences between a partner’s current account ad his capital account? 4.0  Interest paid on loans […]

Accounting Quiz or Test Your Accounting Knowledge on Control or Total Accounts

Tweet Refresh or test your accounting knowledge on Control or Total Accounts QUESTIONS:1.0  What is a control account? —->> refer article 2.0  What ledger entries are made from the discounts allowed column in the cash book? 3.0   Give three examples of typical entries on the credit side of a debtors control account  —–>> refer article […]