What is Business Accounting? Definition and Overview 

Business accounting is a very broad term that includes much of the financial work done by any company.

Business accounting is basically the paper trail that provides numerical evidence of the activities of your company.

What exactly this entails will depend on the size and type of business that your company engages in.



Process

In a nutshell, business accounting accounts for what money is coming in, and what money is going out of a company.

At its most basic level, business accounting starts with bookkeeping, which tracks the transactions that your company makes financially.

It also needs to keep a constant record of the assets and liabilities that a business has.

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Without sound accounting, it is impossible to know what type of financial shape a business is in.

In a broader sense, business accounting includes things like tracking inventory, dealing with business taxation and conducting audits of operations for both internal and external purposes. 

The larger the business, the more complex business accounting becomes.

Business accounting strives to create the most complete picture possible of a company’s financial situation, so that information can be used to make management decisions, file taxes, and provide information to shareholders.

Related Post: What is Management Accounting?



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