Fundamental bookkeeping consists of recording the prime company transactions of sales, purchases and money. The accounting documents supporting and evidencing these transactions getting called prime documents which are entered into the company books by a bookkeeper.

Revenue Invoices

A sales invoice is really a prime document. In more advanced accounting systems technical terms such as sales day books, revenue ledgers, debtors and credit manage are important but at the fundamental level bookkeeping of sales may be the act of recording those sales in the business books.

A sales day book is basically a log of revenue invoices issued by the company and this level of recording financial transactions is all that might be required for a small business. A easy list of the revenue invoices which would be described as part of a single entry bookkeeping system.

A fundamental bookkeeping program for sales invoices will be a single entry bookkeeping program with minimal analysis of the total sales value. An accountant or bookkeeper might make these entries although in smaller organisations the records are often kept through the company owner.

Larger organisations might well maintain revenue day books but would certainly also enter the sales invoices into an accounting program and would generally use accounting software program to do so. Within the financial accounting package the sales would not only appear as a list making up the total sales turnover but would also be entered in a sales ledger.

Each revenue invoice getting allocated towards the numerous clients to whom the revenue had been made. The sales ledger at this stage from the bookkeeping represents the value of goods or services sold to every customer.

Buy Invoices

A buy invoice is a prime document and a purchase day book is really a list of purchase invoices received from suppliers. The purchase invoice day book would not normally require further financial analysis from the type of expenditure. To that extent a simple buy day book will be a great starting point for a simple set of accounts but require a small more sophistication requiring analysis by expense type for both financial manage and taxation purposes.

A basic bookkeeping system for purchase invoices would be a single entry bookkeeping system that also had columns to analyse the expenditure into the expense categories required through the particular tax rules under which the accounts were being prepared.

Medium and larger organisations need to track and control purchase invoices to manage costs and payments. Inside a mirror from the sales ledger system buy invoices would also be entered by supplier into a buy ledger. The simple way is to allocate each supplier a code number so that the accounting software program can collect the amounts owed to every supplier the individual supplier accounts being the buy ledger.

Money and Financial institution Transactions

Quite apart from the single entry of revenue and purchases is the recording by a company in its books of cash and bank receipts and payments. The third area of prime documents is the cash receipt or bank slip, given or received. Such documents might take many forms from the till roll of a retail company towards the deposit slip at a bank but all are evidence of cash changing hands.

In a small company money and bank information may be maintained separately towards the information of other prime accounting information. Inside a simple format the money or bank records will be similar towards the bank statement but showing the names of customers and suppliers or if multiple customers for example then the source of the money being received or paid.

Bigger organisations and particularly using accounting software program also code each receipt and payment towards the same customer and supplier codes utilized to produce the sales ledger and the buy ledger. In addition to recording the money and financial institution transactions in the money and bank accounts the amounts received and paid are also recorded in the sales ledger and purchase ledger.

By recording the cash and bank transactions within the ledgers the customer and supplier records making up the accounting ledgers then show the balances on each account and also the recording of the monetary transactions in this way is effectively the other side from the double entry bookkeeping system.

A little company not requiring sophisticated accounting records for monetary control purposes and utilizing a single entry as opposed to a double entry bookkeeping system could simply record receipts against the list of revenue invoices and also the payments against the list of buy invoices.

Basic bookkeeping utilizing single entry of prime accounting documents will be suitable for little company, requires really little accounting knowledge and when carried out by the business owner rather than a bookkeeper or accountant can save money..