Category: Bookkeeping

  • Retained Earnings: Calculation, Formula & Examples

    In fact, what the company gives to its shareholders is an increased number of shares. Accordingly, each shareholder has additional shares after the stock dividends are declared, but his stake remains the same. Since cash dividends result in an outflow of cash, the cash account on the asset side of the balance sheet gets retained…

  • Accounting Equation Assets = Liabilities + Equity

    On the basis of this dual nature of transactions, modern accountants have developed a mathematical formula that is referred to as the accounting equation. At the same time, they have increased the balance in their checking account. From a bookkeeping perspective, you have to make two entries for this one business transaction, and these two…

  • General Ledger Examples and Types

    It is common to see the number of the transaction if it has been paid by check or entered in for tracking purposes. The general ledger is in the format of “T”, that is why sometimes it is also called “T-accounts”, which on the left side is the Debit and the right side is the…

  • A General Ledger Example Understanding the GL in Accounting

    A subsidiary ledger (sub-ledger) is a sub-account related to a GL account that traces the transactions corresponding to a specific company, purchase, property, etc. If a GL account includes sub-ledgers, they are called controlling accounts. By this same analogy, a ledger could be considered a folder that contains all of the notebooks or accounts in…