Tips for Better Managing Cash Flow

1. Determine Your Breakeven Point

2. Focus on Cash Flow Management, not Profits

3. Maintain Some Cash Reserves

4. Use a Cash Flow Worksheet

5. Collect Receivables ASAP

6. Encourage Customers to Pay up Faster

7. Extend Payables as Long as Possible

8. Boost Sales With Creative Incentives

9. Designate a Cash Flow Monitor

10. Use Technology to Your Advantage

Benefits of General Ledger

2.Benefits of General Ledger

The general ledger provides the position of the business at any given point of time. For example an Cash ledger will reflect the cash in hand as on date, the bank ledger will reflect the bank balance.
It facilitates Bank Reconciliation since all the transactions pertaining to a single bank account are recorded in a single place. A
lso since the ledgers are classified at the time of creation itself, an organization can view all its debtors ledgers at one go.
For auditors, the general ledger is an insight to an organization’s transactions. Detailed analysis of ledgers can give the auditors a deep understanding of the business.

The very base of accounting is Journal entry and General Ledger is the skilful grouping and presentation of the Journal entries. General ledgers provide structure to accounting and facilitate preparations of trial balance which in turn facilitates preparation of financial statements.

Classification of General Ledgers

1. Classification of General Ledgers

General ledgers are classified according to their nature. This classification facilitates the preparation of financial statements. The classification is as follows:

Expense Ledgers: All expenses incurred will be posted in this ledger. Purchase Account, Rent Account, Electricity account, Maintenance Account and the like will all fall under this category.

Income ledgers: All income accrued/earned will be posted in this account. Sales, interest received, Discounts received accounts will fall under this category.

Capital ledger: All accounts pertaining to Capital introduced/drawings will fall under this ledger.

Asset ledger: All accounts pertaining to assets will be posted in this ledger. Cash, Bank, Debtors, Machinery, Furniture accounts and the like will fall under this category.

Liability ledger: All accounts pertaining to debts or obligations of the organization will be posted here. This will include Borrowings, Creditors, Accounts payable and so on.

General Ledger Business

General Ledger Business Processes

Business processes listed below are discussed in the business process section of this General Ledger documentation:

· Create and process journal entries.

· Create and process interunit and intraunit transactions.

· Build summary ledgers.

· Close ledgers.

· Process multiple currency.

· Create and process Average Daily Balance (ADB).

· Create and process open items.

· Consolidate financial data.

· Maintain standard budgets.

· Monitor background processes.

· Review financial information.

· Archive tables.

· Generate regulatory ledger reports.

· Create XBRL documents.

· Generate general reports.

· Generate federal reports.

· Create and process allocations.

· Generate statutory reports.

· Create and process Commitment Control transactions in General Ledger.

· Create and process entry event transactions.

· Process subsystem journals using Journal Generator.

· Import and process spreadsheet journal entries.

· Import and process transactions from a flat file.

· Enter and process statistical transactions.

· Enter and process Value Added Tax (VAT) transactions.

· Approve journal entries for processing.

· Perform account reconciliation.

· Run General Ledger background processes.

Accounts in Business

The Different Types of Accounts in Small Business Accounting

Cash Accounts

Bank Accounts

Credit Cards

Undeposited Funds

Income Accounts

Expense Accounts

Assets

Liabilities

Equity

Accounts Payable

Accounts Receivable

Cost of Goods Sold

Gain or Loss on Foreign Exchange

Health Spending Account

Accounting Rules:

Personal account can be classified into 3 types as :

(1) Natural personal accounts :

These are the accounts which denotes natural human beings like Ajay , Bali , Chandan , Diya etc.

(2) Artificial personal accounts :

These are the accounts which are used to indicate that transactions occur with entities which have a separate legal identity which they possess in the eyes of law.
For example ABC Ltd., Government , State bank of India etc.,

(3) Representative personal account :

These are the accounts which are indirectly related to the natural and artificial persons. For example Prepaid account , capital account , outstanding liability account etc.,

B) Real account :

A real account is used to record the transactions related to assets. The term assets include both tangible and intangible. Tangible assets are the assets held by the business , which can be seen and touched. Where intangible assets are the assets which can’t be seen and touched.

For example Plant and machinery, Buildings , cash account come under real account. And intangible assets like goodwill , patents , trademarks also come under real account.