Accounting and Finance Questions

There are broadly  2 Type of accounts

1. Personnel Accounts

2. Impersonnel Accounts.

Personnel Accounts is an account maintained to record transactions with persons. Based on the classification of the persons personnel account can be of

1. Natural Personnel Account (Mr. Ram, Mr. Robert, Mr.Rahim)

2. Artificial Person (all entities like companies, banks, municipal corporations, all statutory or non statutory bodies)

3. Representative Person: Representing group transactions for group of persons like Salary Payable Account. Taxes payable account.

Where as Impersonnel Account shall be of Two types.

A. Real Account      B.Nominal Account.

Real Accounts are accounts to record transactions relating to Assets. Like Cash, Plant & Machinery etc., These type of accounts are permanent accounts.

Nominal Accounts are the accounts used to record the transactions relating to Income and Expenses. Like Salary, Power, Sales etc., At the end of the year all the nominal accounts are closed by transferring to Profit and loss account or Income and Expenditure account. The net differnce shall be carried forwarded to Balance Sheet.

If an outstanding check of the previous month clears the bank (is paid by the bank) in the current month, you simply remove that check from the list of outstanding checks.

If an outstanding check of the previous month does not clear the bank in the current month, the check will remain on the list of outstanding checks until the month that it does clear the bank.

In the bank reconciliation process, the total amount of the outstanding checks is deducted from the balance appearing on the bank statement.

Invoice holds are 2 types
1)Sytem Hold               2) User Defined Holds.

Sytem Holds: Sytem holds the invoice if the Invoice Amt total is not equal to Invoice Distribution Amt. To release the hold correct the amount and again validate the invoice.

User Defined Holds: These is defined by user. If we do want to make payments to the validated invoice. Go to particular invoice and apply hold going to Holds tab.

When an invoice is generated and sent to the client/customer, the JE to be passed is debit customer account and credit revenue/accounts receivable account. When payment is received from customer, then debit bank account and credit the customer account concerned

Accounts payable refer to the current liability of a business or an organization. That is the unsettled payments in a business or an organization refers to Accounts payable.

Bills payable refers to bills settled. In other words the paid and accepted recorded bills in a business or an organization refers to bills payable

Tally is one of the best business accounting software for accounting, inventory, payroll. It is economical and one of the most popular ERP software solutions available in the industry.

Tally, an accounting software was developed by the multinational company TCS - Tata Consultancy Services.

CRR or Cash Reverse Ratio is the amount of money that a commercial bank has to keep with the Reserve Bank of India. If the bank increase CRR then the amount with RBI comes down and vice-versa.

Contra-entry is the entry which effected the both sides in cash book.

It is occured in three times, i.e.,

1.Cash deposited in to bank,

2.Cash withdrawn from the bank for office use, and

3.Receivable cheque deposited in to the bank in another day.