Types of bookkeeping

Bookkeeping is a skill to record the finances and expenditures of a company. It is a helpful skill to use or employ a professional bookkeeper to know how much profit has been earned, how much money has been made by the company or how much is required to pay.

There are many types of bookkeeping which are offered by bookkeeping and accounting firms in Dubai. Some of them are:

Cash: It involves keeping a record of your cash through a cash account. Usually, bookkeepers make the journal to record cash disbursements and cash receipts. It is the most basic type of bookkeeping that involves tracking business transactions via cash.

Receivable: Some companies are paid after some time for their services and products. These companies have bookkeepers who keep the record of receivables or how much money is going to be paid by customers. The recorder updates the file of invoices regularly and send bills to customers.

Accounts Payable: It is a type of bookkeeping that involves recording all payments and loans concisely to avoid making blunders in paying someone. It is usually used by small businesses that used to take loans from microfinance and use them to get products.

Loans: It involves tracking all the loans the company has taken from other companies or individuals and where they are spent. It is the responsibility of the bookkeeper to keep a record of where the borrowed money is used and how much is it used.

Payroll: Payroll expenses are all about paying your employees and taxes to the federal and provincial government. Most of the expenditure is due to payroll expenses. Therefore, there is required to use payroll expenses to track how much taxes are required to pay and how much bonus or salaries will be given to each employee.

Owner’s equity: It is all about tracking the account of the owner or owners of the company. Owners’ equity is also called as net assets. Bookkeepers subtract assets from liabilities and update the record timely.

Retained earnings: Retained earning involves keeping the record of profits that are kept in the company’s account to invest them instead of spending them on employees. The recorders track how much money has been retained or kept since the company has started.

Inventory: Inventory is to keep the record of unsold products and unused services to know how much the company is in loss. For the record, bookkeeping firms also offer assistance with company liquidation in Dubai.