I will not explain accounting in a special account for that, but I will give you a general explanation that might be able to explain exactly how it works (in which case someone wants to explain it in its specificity is requested to communicate any comments or via the contact page).
First, the business accounting is all about and helps to manage the company, ie, which helps to keep their accounts in good standing and to understand what steps to take in various situations.
Many are convinced that a good idea can generate a great company with immediate gains safe. Unfortunately it is not always so easy.
A good idea can generate many useful if you are aware of what the company is and if you have the correct adequate accounting.
The accounting system is represented by real accounts, each account identifies a specific item and can not be equal to any item of any other account.
Each account must be entered in a book of accounts, which subdivide the account groups, each group of sub-specific.
A few examples if we account for the property, there will be an account for each property owned properties and a specific account, for example Head Mother and branch (the above examples are of school and do not always reflect reality).
The same will happen to the mobile account, where you will have office furniture, computers, lamps or different.
For customers and suppliers will have a specific account for each of them: Customer x or xt and Supplier x or xy. More customers and suppliers will mean that there will be more accounts opened with suppliers and customers.
The tax credit is to be in debt will have separate accounts for the one and the other.
Each account will have a give and take. Giving is what the company has to give to others, is to have what the company has to have the other. In fact, all business costs are recognized when to get in and revenues.
There are accounts unidirectional and bidirectional, ie accounts that only work in debit or credit accounts and working is to have both. The former can be, for example, the VAT accounts, in fact, account for VAT credit will only work in giving, while the income tax payable will work only to have the VAT behalf of the government will work with both, give both have.
The accounts will be closed until the end of the financial year and then be re-opened with the opening of the same. Each account balance at year-end should give 0. Excluding the Cash account that will be tied by hand (this will be discussed more later with the financial statements).
A glimpse of the ledger, the book contains the so-called master of masters, they are the graphic representation and amount of each account existing farm, without them you could lose some accounts and there would be problems in the control of management.
Having a certain accounting and audit is required if you want to have a healthy company.
Rashna