Accounting

Accounting is the method in which financial information is gathered, processed and summarized into financial statements and reports.

• A journal is a place to record the transactions of a business. Journals are used to record the day-to-day transactions.
• While a journal records transactions as they happen, a ledger groups transactions according to their type, based on the accounts they affect. The general ledger is a collection of all balance sheet, income, and expense accounts used to keep a business's accounting records. At the end of an accounting period, all journal entries are summarized and transferred to the general ledger accounts. This procedure is called "posting".
• A trial balance is prepared at the end of an accounting period by adding up all the account balances in your general ledger. The sum of the debit 
• balances should equal the sum of the credit balances. If total debits do not equal total credits, you must track down the errors.
• Finally, income/financial statements are generated from the information in your trial balance.