COMPUTERIZED
ACCOUNTING
BASICS
1
LEARNING OBJECTIVES
After completing this chapter the
student will be able to:
6
Discuss end of period
processing.
1
List and describe the activities
involved in the accounting cycle.
7
Discuss the basics of creating,
using, and changing a
password.
2
Give the basic structure of any
accounting system: modules,
commands, and fields.
3
Analyze transactions in narrative
form or from the source
document.
4
List the two data entry modes:
batch and real time processing.
5
Discuss how each module
integrates to the General Ledger
and relates to other modules.
8
Make a backup and archival
copy of the data.
9
Compare a manual accounting
system to an automated or
computerized accounting
system.
10 Give the advantages and
disadvantages of automating
the accounting books.
11 List the steps to convert from a
manual accounting system to
an automated accounting
system.
12 Describe the four general
types of accounting programs:
tutorial, personal, basic, and
high-end.
13 Apply software evaluation
criteria to evaluate a software
program before purchasing.
14 Identify the overall
characteristics of the Business
Works.
15 Boot up to the main menu and
exit to the operating system.
16 Restore and Back-up Data.
17 Install the Business Works
program and create working
data.
Computerized or automated accounting is the most popular method of handling a
company’s accounting records. Only very small businesses with a few
transactions perform the accounting functions using a manual or handwritten
system. This is because of the time-saving features of an integrated,
computerized system. Chapter 1 presents the basic information that applies to all
computerized accounting programs.
The first step to automating accounting records is to select an accounting
software program. Every accounting software program has unique characteristics
that set it apart from other accounting programs. The user should become familiar
with these characteristics to speed the entry of data.
Before purchasing an accounting program the user should always know the level
of the accounting program [high-end, basic (mid-level), or personal (entry-level). The
user should evaluate many programs before purchasing one. An evaluation form like
the one included in this chapter will be helpful. (See Page 24)
INTRODUCTION
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1-1
Section 2 of this chapter begins the discussion of the Business Works program’s
special characteristics. In essence, this section contains the beginning of the Business
Works User’s Guide. It covers program requirements, special keys, dates, window type,
field editing, and log-on and exit procedures. Refer to this section and others throughout
the text while entering data in the chapter exercises.
SECTION 1:
COMPUTERIZED
ACCOUNTING
THEORY
______________
Accounting
Cycle
Steps
L.O. 1
An accounting cycle is the process of entering transactions from source
documents into a system and producing a variety of reports for management.
The steps in the accounting cycle are listed below.
1.
2.
3.
4.
5.
Analyze transactions from source documents.
Record transactions in assorted journals.
Post all the journals to General Ledger.
Prove the General Ledger with the Trial Balance.
Prepare Reports/ Journals:
General Ledger (G / L):
Chart of Accounts
General Journal
Special Journals
*Cash Receipts Journal
* Cash Disbursements Journal
* Sales Journal
* Purchases Journal
Accounts Receivable (A / R):
Customer List
Aged Accounts Receivable
Sales Journal
Cash Receipts Journal (Customer’s)
Payments
Account Payable (A / P)
Vendor List
Aged Accounts Payable
Purchase Journal
Cash Disbursement Journal
Check Register
Payroll (P / R)
Employees Earnings Record
Payroll Registers
Paychecks
Monthly Report
Quarter-to date Wage Reports (941,DE3)
Inventory (INV)
Master List
Price List
Activity Report
Inventory Status Report
Reorder List
On-Hand Report
Physical vs. Perpetual
*Only if using General Ledger Module by itself.
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1-2
Month End
6. Enter adjustment entries:
G/L
Fixed Assets
Prepaid expenses, unpaid expenses, accurals
Adjustments
Depreciation Adjustment
7. Print the General Ledger.
8. Print the Financial Statements:
Trial Balance
Income Statement
Balance Sheet
*Cash Flow Statement
*Statement of Owner’s Equity
Budget vs Actual
Detailed General Ledger
9. Close General Ledger for month.
New Month- Beginning
10. Enter reversing entries.
11. Print a new General Journal and Trial Balance.
Year End
Replace the above steps, 10 and 11 with following:
10. Enter closing entries.
11. Prepare post-closing Trial Balance and print Balance Sheet.
12. Analyze financial statements.
Every company and corporation follows the accounting cycle. The method of
performing these steps and producing the reports may vary widely from company to
company. However, all the steps must occur either In the actual company or the
corporation’s home office.
A computerized accounting system is structured to include modules, commands, field
and records (Fig.1.1). A module is a separate accounting activity such as the General
Ledger or Accounts Receivable. A command is sub-activity that changes the data in
the module, such as “Enter new customer” or “Enter cash receipt.” A field is a oneline piece of information, such as Customer Name or Customer Type. A group of
fields make up a record. For example, every journal entry includes the fields: date,
name of the debit account and the credit account, plus the dollar amount. This journal
entry is now a record. There is a difference between a record and “to record.” “To
record” is the process of entering a transaction.
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Computerized
Accounting
System
Structure
L.O. 2
1-3
FIGURE 1.1
Computerized Accounting
System Structure
____________
Accounting
Program
____________
_________
General
Ledger
--------------
____________
Accounts
Receivable
-------------------
Program
___________
Accounts
Payable
------------------
__________
Enter New
Customer
-----------------
Record
Command
Number
Name
Address
Type
Balance
Fields
A computerized accounting system consists of many modules. The six basic module
are:
*General Ledger / Financial Analysis
* Accounts Receivable
*Accounts Payable
*Payroll
*Inventory
*Job Costing
A System Manager Module is included in any accounting system. Commands that
would effect the entire company would be included in this module. For example, the
company name, address, terms and back-up and restore data disks.
A Budgeting module can include additional features. As a company expands, it can
add other modules to increase the power of the accounting system. The chart in Table
1.1 provides a list of these other modules.
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Module
1-4
TABLE 1.1
Module Main Files
FIVE MAIN MODULES AND THEIR MAIN FILE
MODULE
General Ledger
Accounts Receivable
Accounts Payable
Payroll
Inventory
Job Costing
Others:
Sales Invoicing
(Order Entry/Invoicing)
Budgeting/Forecasting
Financial Analysis
Points of Sale
(Cash Sales)
Purchasing
MAIN FILE
Chart of Accounts
Customer File
Vendor File
Employee File
Part # (Item File)
Employees/Vendors/Inventory
Customers/Item File
Chart of Accountings/Balance
Chart of Accountings/Balance
Inventory Items/Price List
Vendors/Item File
Add-On Module: Address Labels, Database Reports, invoice , organization.
MODULE ACTIVITIES
Each module is organized into five basic activities:
1.
2.
3.
4.
5.
Setup
Main File
Maintenance
Data Entry
Report Generation/Printing
The Setup is a very important part of each module. This information is entered once then
updated with the maintenance options. The user should enter the special values in each
module. Examples of these special values are:
1.
2.
3.
SETUP
the sales tax percentage in the Accounts Receivable module
the credit terms (2/10 Net 30) percentage and date due in both the A/R and A/P modules
the social security/Medicare rates in the payroll module.
If the setup values are incorrect, the automatic calculations performed by the computer will be
incorrect.
Each module’s main file consists of records with data fields that describe the particular record.
The main file in the General Ledger is the Chart of Accounts. The individual record of the Chart
of Accounts is the particular account number and name, such as 101 CASH. The user needs
to enter data into each field of the record. In the example of account number 101, the fields
may be:
1. account number: 101
2. account name: cash
3. account type: current asset
4. beginning balance: $3000
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1-5
MAIN FILE
The maintenance option updates the records in the maintenance file. Any maintenance option,
whether an accounting, spreadsheet, or database program, can perform four activities on the
records in the main file: add, change, view and delete.
The Add command allows the user to enter new accounts, customers, vendors, etc.
The Change command allows the user to change every field or information line within the
main record except the record number (account #, customer #, vendor #). The number is fixed
and cannot be changed. However, to solve this problem the user can delete the old record and
reenter it with a new number.
The View command is used to verify the information before making either a new transaction or
print a report. It is always a good idea to view the report before printing a hard copy. It will
reduce the amount of paper used. If the program does not have a view it of the main file or
transaction, the user can use the change command and just not make a change. In Business
Works this would be the Lookup icon.
Delete also allows removal of any record in the main file that does not have current data.
Display commands that list the record and its fields on the screen can also be included.
The record number is the only field that the user cannot change in the main file. The Chart of
Accounts number is an example of the record number in the General Ledger. The customer
number is an example of the record number in the Accounts Receivable.
Figure 1.2 shows a screen display of the options available in the Business Works accounting
program.
First
Last
Previous
Next
New (Add)
Rename (Change)
Save Undo
Lookup
(View)
Delete
FIGURE 1.2 Available Options in the Business Works Program
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1-6
MAINTENANCE
DATA ENTRY
During data entry, the user can select one of four options: add a transaction change a
transaction, delete/void (remove) a transaction, or display/view a transaction. The
command “Post to Journals” is used to enter journal entries in the Business Works
program. In some programs you will select “Tasks” then General Journal entry. The
same four option will be available in any program. Figure 1.3 is a screen display of the
Business Works accounting program’s General Ledger Journal Entry input screen.
After the user selects an option, the program prompts the user to enter data in each
field.
FIGURE 1.3
Business Works Program General Ledger Input screen
First make sure the date is correct and the reference # is correct. The description of
the transaction is the reference field.
The account name appears automatically when the user enters the account
number. This allows proof of the proper account number. The user enters the
dollar amount as a debit or credit. Click on “Accept” and the entry will appear
below. The balancing entry is entered and accepted. Once the journal entry is correct
then click on “Post”. If the user does not enter a value in a field, the default value or
the information from the previous entry will be used.
REPORT
GENERATION
Each module three types of reports: Master
File, Transaction Reports, and
Integration Reports.
The Master File Report includes the master file and all its fields, such as the Chart
of Accounts or the Trial Balance in the General Ledger, A/R and A/P Subsidiary Ledger
(also called Detail Report in Business Works.
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1-7
The Transaction Reports include the current month transactions. A general
journal report is an example of the General Ledger Transaction report. Other
transaction reports would be the Sales Journal of the A/R module and the Purchases
Report of the A/P module.
The Integration Report presents the total of the accounts and dollar amount sent
to the General Ledger. Of course this report only appears in every module except the
G/L.
REPORTING
PRINTING
There are three destinations for a report:
1) Screen(Soft Copy)
2) Printer (Hard Copy)
3) File (Transfer)
It is always best to print to the screen to check for accuracy before printing to the
printer. Many times errors can be seen on the screen and corrected before a hard
copy is printed and filed.
If the user needs the data from the accounting program to create a spreadsheet file
most accounting software now allows this procedure.
Table 1.2 summarizes the five main module activities.
TABLE 1.2
Main Module
Activities
MODULE
ACTIVITIES
Setup
Add company-wide values
Main File
Add all the main file records for each module
Maintenance Option
Add, Change, Delete, or Display (Query, View)
Data Entry
Transactions: Add, Change, Delete/Void
Report Generation
Report Printing
Master File, Transaction File, Integration Report
Screen, Printer, File
Data Entry Basics
General knowledge about the data entry procedure will deter errors and increase the speed of data entry.
The most important accounting function of a bookkeeper or an accountant is to
analyze a transaction or decide what accounts to use to enter the transaction. This is
commonly called coding. The question to answer when coding a transaction are:
Analyzing
Transactions
1. What is the type of transaction that is occurring? Is it a cash receipt, sale, cash
payment, or purchase?
2. What accounts are affected by this transaction? Are they debited or credited?
3. What is the dollar amount to be entered into each account?
4. In what module should this transaction be recorded?
5. What is the name of the main file that will be affected?
6. What is the expected result of this transaction? Will it increase or decrease the
affected accounts? This is necessary in order to double-check the results
generated by the computer.
L.O. 3
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1-8
Transactions can be presented in two forms: a narrative or source documents. In this
text, the transactions will be provided in a narrative manner. Source documents such
as checks, sales invoices, and purchase orders are used for data input in the
business world. Coding the source documents before the data are input could be a
timesaver.
When given a list of transactions in a narrative format, as opposed to source
documents, it is helpful to code the transaction. One method is to underline the
company name and place the vendor/customer number above it. Underline the dollar
amount. Circle the invoice number for the transaction. Place the module for the
transaction in the right margin. This method is shown in Figure 1.4. It is best for each
individual to design his/her own coding method.
NARRATIVE
TRANSACTIONS
Narrative Transaction
FIGURE 1.4
Narrative
Transactions
201
Feb 1 Voucher No 702 to Lewis Supplies for payment; no discount A/P
4
115
Received cash in account from East Wholesale, Ck # 7516, $5,829.00
Sales Invoice No. 597; less discount
A/R
5
401
Purchased merchandise on account from Map Manufacturing Co., $1,894.20
Voucher No. 703; terms 2/10, n/30
A/P
9
050
801
Record Voucher No. 695 to Bottom Properties for monthly rent;$920.00
A/P
401
12 Returned merchandise to Map Manufacturing Co.,$64.00. The debit memo
applies to Voucher No. 703
A/P-DM
17 Received cash for rent, $1140.00; Cash Receipt No. 26
A/R
Definition
Source documents contain the information necessary to record a business transaction.
Examples of source documents are checks received from customers, invoices, checks written
to vendors, and Purchase Orders.
TRANSACTIONS
FROM SOURCE
DOCUMENTS
How To Use Source Documents
To analyze, put the documents in like batches (batches of similar transaction), such as all the checks
received in one pile, all the invoices written in another, and so on. Then put the customer or vendor number
by the name and circle the necessary information for the entry, i.e., the fields to be entered. Input the fields
in the correct module. Figure 1.5 shows an example.
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Figure 1.5 Example of Coding and Organizing Source Documents
WRITE-UP WORK
Source documents are the primary source of transactions in the accounting industry.
Many self-employed bookkeepers/accountants use their clients’ source documents to
record the data and produce the required reports. This is called write-up work.
To analyze a client’s transactions using source documents, make sure the client
provides a copy of all the business invoice, Purchase Orders, and check register.
Invoices and Purchase Orders can be entered by batching, then circling the
information and writing the customer/vendor number on the documentation.
The check register is for checks written and deposits (cash received). For the checks
written, the client should indicate what the check is paying in the description column.
Use this description to “code” or enter the correct G/L account number for the
transaction. Next, enter the vendor number and circle the appropriate information.
The client should always deposit the checks the day they are received. Checks
received should not be used as a data entry tool. The client should record the deposit
in the check register and be sure to include the following information: check date,
customer name, check number, and dollar amount. Also needed is the sales invoice
number that is to be paid. This is usually in the reference column of the check stub or
remittance advice. Sometimes the check stub or a copy of the check is all that is
needed. An example of this method is shown in Figure 1.6.
The most efficient procedure would be for the client to make photocopies of checks
received (stub and all) in batches by deposit. Using this method you do not have to
depend on the client recording the correct information from the check. This method
also makes your A/R more accurate as you have all the customer checks in your file.
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1-10
Check Register: CASH
DATE
7/31
SOURCE OF ITEM
Smith & Wesson
H&H Construction
Wiley & Associates
Evons company
Ck #
75657
3225
24111
10114
NATURE
OF ITEM
INV 3110
3098
3102
3109
RECEIPTS
FIGURE 1.6
AMOUNT TOTAL. AMOUNT Check Register:
OF ITEM
OF DEPOSIT
Use in Write-up
76.53
Work
321.67
802.77
300.13
1501.10
Check Register: CASH PAYMENTS
NO DATE
3045 7/28
3046 7/28
7/31
DESCRIPTION
OF
TRANSACTION
Pacific Bell
Sandy Bank
Deposit
IN
PAYMENT
OF
Telephone
Pur-Sand
PAYMENT/
DEBIT
(-)
70.57
110.00
Act
#
DEPOSIT/
CREDIT
(+)
BALANCE
29,875.57
29,765.57
1,501.10 31,266.67
It is important to meet with the client on a regular basis to make any adjustments that
are necessary. Frequently returns and allowances do not get taken out of the A/R
with a Credit Memo because the client forgets to write them down, leaving the
customer with an overstated balance. It is annoying to customers to be re-billed for
items that have been returned and should have been credited to their account. It is
therefore best if credit memos are properly recorded as they are issued. Sending out
monthly statements tends to improve this situation.
Sometimes small business clients want to store all their accounting documents. If
this is the case, documentation for each check (i.e., bill, request for payment,
statement, receipt) should be requested to place in the client’s file.
There are two basic types of data entry: batch mode and real time processing.
As shown in Figure 1.7, in batch mode data entry the program holds the transactions
in a temporary file until the user gives a command to update the master file. The
program later posts these transactions to the General Ledger by using the POSTING
command.
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DATA ENTRY
MODES
L.O.4
BATCH MODE
1-11
FIGURE 1.7 Batch Mode Data Entry
Some programs using the batch mode keep all the transactions in the computer
memory until the user leaves the system. Upon leaving, these transactions are
entered into the General Ledger. This mode is fast, because it records the data in a
group. Therefore reading and writing to the disk is not required every time an
individual item is entered.
However, there is also a major problem with this mode: If there is an interruption during
data entry and before leaving the system, all the data will be lost.
The major benefit of using the batch mode is the user’s ability to change the entry
before permanently recording it to the accounting system. Once the transaction is
posted to the General Ledger, it must be voided or reversed to correct it.
REAL-TIME
PROCESSING
In real-time processing, as shown in Figure 1.8, the program automatically posts the
transactions to the General Ledger as it is entered. The transactions are written to the
disk and update the master file immediately. Some programs require the user to check
or verify the transactions before going on to the next transaction. The user completes
the checking and presses the Post key. This process posts or updates the transaction.
The major advantage of real-time processing is that should the user be interrupted
during input, only the current transaction is lost—not all the data that have been
entered. This mode takes a little longer to process. But it is well worth the time to
know you have the data stored at the time of entry and all accounts are current.
FIGURE 1.8 Real-Time Processing
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All computerized accounting systems have an integration feature. Integration means “talk to
each other” or send summary information from one module to another. The software
program carries the details of the transaction in the individual module, and sends a summary
of all the transactions to the General Ledger.
Module
Integration
L.O. 5
Some accounting systems allow the user to decide whether to integrate. If possible, it is wise
not to integrate at first. Integration can amplify all errors, making them hard to correct.
An example of integration is found in the Accounts Receivable module. At the end of the
month, or when the invoice is actually created in the Accounts Receivable module, it is
automatically entered into both the particular sales account and in the Accounts Receivable
account. When the invoice is paid and recorded as a cash receipt, the invoice is taken out
or credited to Accounts Receivable and added or debited to the cash account ( see Figure
1.9)
Example Of
Integration
To integrate, the user must identify certain accounts in the General Ledger that will
receive the information being sent by the other modules. There accounts are “offset or
integration” accounts. The most important account is, of course, the cash account as
seen above. The user must also enter into the system the other accounts that have
subsidiary ledgers, such as Accounts Receivable, Accounts Payable, and Payroll.
Figure 1.10 shows a screen display of the integration or General Ledger offset
accounts used in the Business Works accounting program.
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1-13
FIGURE 1.10
Integration (Posting) Offset Accounts In Business Works
A/R Posting (Integration) Accounts
A/P Posting (Integration) Accounts
Each module must have its own integration accounts. The integration accounts include
account numbers for Sales Returns and Allowances, Purchase Discount, and Sales Tax
Payable, to name a few.
When one module is integrated to another module, the system uses information from one
module to enter transactions in another module. For example, when creating an invoice,
the program obtains the account number from the Chart of Accounts in the General Ledger
and the customer number from the Accounts Receivable module. A summary journal entry
is created by the system at the end of the month and is sent to the General Ledger. The
Module Integration Table (Table 1.3) shows how information is sent from one module to the
other. The entries should be set up as defaults, which can be changed.
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1-14
TABLE 1.3
MODULE
INTEGRATED
RECEIVED
G/L
Module Integration
NAME
TO
INFO FROM
JOURNAL ENTRY
Table
________________________________________________________________________
General Ledger
None
All Modules
______________________________________________________________________________
Accounts Receivable
G/L
Sales Invoice
A/R
Sales
Inventory (Perpetual)
Cost of Goods Sold
Inventory
Check Received
Cash
A/R
_____________________________________________________________
Check Received
Cash
W/discount
Sales Discount
A/R
_____________________________________________________________
Credit Memo
Sales R & A
A/R
_______________________________________________________________________________
Accounts Payable
G/L
Purchase Orders
Purchase/Expense/Asset
A/P
A/P
Inventory (Perpetual)
Inventory
A/P
_______________________________________________________________________________
Credit/Debit Memo
Purchase R&A
A/P
____________________________________________________________
Check Written
A/P
W/discount
Purchase Discount
Cash
_______________________________________________________________________________
Payroll
G/L
Payroll Register
Wage Expense (X)
FICA Pay
FIT Pay
SIT Pay
Wages Pay
Payroll Tax X
FICA Pay
FUTA Pay
SUTA Pay
____________________________________________________________
Paycheck
Wages Payable
Cash
_______________________________________________________________________________
Inventory
G/L
Adjustments
Inventory Shrinkage X
Inventory
Purchases increase inventory, sales decrease inventory
_______________________________________________________________________________
Fixed Assets
G/L
Depreciation
Depreciation Expense
Accumulated Depr.
_______________________________________________________________________________
Once all the transactions are entered and corrected, the transaction reports need to
be printed. When all is correct the month/period can be closed. If the month is the
last month of the fiscal period, year-end processing should be performed.
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Period End/
Year End
L.O.6
1-15
End of Period Processing can be referred to as End of the Month, Month End, or
Posting.
END OF PERIOD
PROCESSING
The function of the End of Month command is to clear the current month transaction
and/or label them as prior month. The current month balance becomes zero. This
leaves the current month ready for the accumulation of new transactions. This is
why the end of month function must be performed before starting the next month’s
transactions.
A third activity of this command is to add the current balance for this period to the
year to date total for each account, otherwise called posting. Some systems allow
you to start the new month and go back at a later time to close the previous month.
Note that a report of all the transactions must be printed prior to closing. This will
provide for a proper audit trial.
The End of Year command clears current and year-to-date balances in the
temporary accounts (income, cost of goods sold, and expense accounts) to zero.
The balance in these accounts is entered into the income summary account.
END OF YEAR
CLOSING
The program then closes the income summary and drawing to the capital or retained
earnings account. Assets, Liabilities, and Equity retain their year-to date totals
Most accounting programs require the end of month activity to be completed before
starting the year-end functions.
A password is defined as a string of characters entered during setup, known only to
the individual user. Its purpose is to restrict access and to keep the data and
program from being changed by unauthorized users.
A password can be entered during the setup procedure. The program prompts the
user for a password. Once entered it must be reentered each time the data is
accessed. Usually a window will appear during the log-on process asking for the
password.
Passwords
L.O.7
PASSWORD ENTRY
The password option is an option in the menu under system configuration. The
steps to add a password are:
(1) boot up the program without the password
(2) select the option and enter the password.
(3) From that point on, the password is needed to access the program, change
the data, or change the password.
If a password is to be eliminated, select the password option, enter nothing, and
press Enter, thus erasing the password. Remember, you need the password to get
to this point.
The password can be up to a specified number of characters as required by the
program. “Up to” means it can be one alphanumeric character or any number to the
maximum specified number. “Up to 8 characters” means it can be one, two, three,
up to 8 or the defined size.
Some programs have passwords with levels. This means that different passwords
have access to all or only selected parts of the program and/or data. For example, a
company might want to allow a data entry clerk access only to the payables. The full
charge bookkeeper could have access to enter transactions in all modules but not the
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PASSWORD
CHARACTERISTICS
LENGTH
LEVEL
1-16
ability to make prior period adjustments. The controller could have access to all area
including prior period adjustments. Each level would require a different password.
This is useful in manufacturing companies where the sales staff cannot enter
inventory into the system, or allow the stocking clerks to enter a purchase order.
Fraud is kept to the minimum when using passwords.
CAUTION: There is no remedy for a forgotten password.
If you forget for password you will need to contact the software company for help, they
usually can identify your password for a fee.
Usually, passwords are case sensitive. This means that if you use all caps when
entering the password, you must use all caps for the password each time if it entered.
When selecting a password make it meaningful, something you can remember. Many
users select their birth date as the password. This would be acceptable If the data are
not sensitive and your birth date is not common knowledge. Any number that is public
knowledge, such as the user’s phone number, mom's number, etc, should NOT be
used as a password.
PASSWORD
SELECTION
If your data are particularly sensitive, for example, next year’s budget or employees’
salaries, changing the password on a regular basis would be appropriate.
A secure password could be a combination of letters and numbers in upper-and
lowercase characters. However, you should remember it or write it down and place it
in a secure place. Changing the password and its written location would be advisable
writing the password in the manual is not a good idea.
Because students have a tendency to forget passwords, do not use a password.
However, most business accounting programs will required one.
BUSINESS WORKS
PASSWORD
Business Works has a password that is entered in the System Manager. Once the
password box has an X in it the start up screen will show a password box. See
Figure1.11.
Figure 1.11 Business Works Password
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Always make a backup copy of your data before ending your lab session or before
posting in case of computer failure or disk error. Remember, your backup is as
valuable as the time it takes to reenter all your data.
In a business setting, a user may wish to make a week’s worth of backup copies. This
would provide a disk for each day of the week. For example, at the end of Monday you
will copy your data onto the Monday diskette; at the end of Tuesday you will copy
Tuesday’s data on the Tuesday diskette, and so on. When the next Monday comes,
you will reuse the Monday diskette.
Backup
Copies
L.O. 8
DATA DISK
BACKUP
This procedure is helpful should you have hardware failure or a virus that ruins data
before you are aware of it. Damaged data can usually be identified within a week. If
you have a copy of the data from before the damaged data you will need to reenter
only a few day’s worth instead of setting up the data again.
When reusing backup disks to make newer backup copies, the same files with updated
data will be copied onto the backup disk. Since these files exist on the backup disk and
there can be only one file with the same name on a disk, the copy procedure will erase
the old file and put the new file with the same name on the disk. The result will be two
disks containing the same data. Figure 1.12 shows the procedure for making backup
copies of your weekly data.
NOTE:
The time between backups relates directly to how much
work you are willing to reenter.
Figure 1.12
Back-up Copies
HARD DRIVE
MONDAY TUESDAY
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WEDNESDAY
THURSDAY
FRIDAY
1-18
Manual
Vs.
Computerized
Methods
L.O. 9
The manual system uses handwritten ledgers and journal sheets. The user enters the
information in the journal and then transfers this information to the General Ledger.
With a computerized system, the user needs only to enter the information in the
journals. The information is automatically entered into the ledgers. Accuracy becomes
the utmost concern at this point.
A comparison of manual and computerized accounting systems shows that the
procedures for setting up a company, new or existing, are the same. The chart in
Table 1.4 illustrates this fact. Both methods also must enter the daily transactions.
The main difference between the two methods occurs with the end of the month
posting and the report writing. The posting is a cumbersome job in the manual system.
With the computerized system it is fast and automatic, requiring the user to simply
select the proper command.
MANUAL
COMPUTER
___________________________________________________________________
Set Up Books (performed only once)
___________________________________________________________________
1. Set up General Ledger
Add Chart of Accounts
X
X
Record Beginning Balance
X
X
2. Set Up Account Receivable
Add Customer List
X
X
Record Open Invoices Balances
X
X
3, Set Up Accounts Payable
Add Vendor List
X
X
Record Unpaid Vouchers (Invoices)
X
X
4. Set Up Payroll
Add Employee List
X
X
Add MTD,QTD,YTD Totals
X
X
TABLE 1.4
Manual vs
Computerized
Chart
* month-to-date (MTD), quarter-to date (QTD), year-to-date (YTD)
Enter Tax Rate/Tables
X
3. Set Up Inventory
Add Items File
X
X
Enter on hand amount
X
X
MODULE
Daily Transactions (record Transactions in Special Journals)
_____________________________________________________________________
Cash Receipts
G/L
A /R
Cash Disbursements
G/ L
A/ P
Purchases
G/ L
A/ P
Inventory
Sales
G/L
A/R
Inventory/Order Entry
Payroll
G/L
P/R
New Chart of Accounts
G/L
G/L
Journal Entries & Adjusting Entries
G/L
G/L
G/L= General Ledger A/R= Accounts Receivable A/P= Accounting Payable P/R= Payroll
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TABLE 1.4 (Con't)
MANUAL
COMPUTER
__________________________________________________________________________
End of Month
Post to Journals to General Ledger
X
Post A/R and A/P to G/L
X
Total General Ledger
X
Prepare Customer Statements
X
*
Prepare Trial Balance
X
*
Prepare Balance Sheet
X
*
Prepare Income Statement
X
*
Close the month (Post Transactions)
**
Beginning of Next Month
Reversing Entries (can be automatic)
X (G/L)
X (G/L)
End of Year
Record Year-End Adjustments
Close Books
X
X
X
**
* Printed automatically by selecting the appropriate option.
** No calculations required—just select the appropriate option
_______________________________________________________________________
ADVANTAGES
AND
DISADVANTAGES
L.O.10
A list of the advantages and disadvantages of computerized accounting follows.
The advantages far outweigh any disadvantages. However, it is up to the
individual user to utilize these advantages.
Computerized Accounting Advantages
1. Account balances are always current because the user constantly posts the
transactions.
2. The computer performs the posting process (writing the transaction in the
account on the debit or credit side and adding the print balances in the
current transactions to achieve a new end of month balance) automatically.
3. The modules use information from each other (integration). Integration
requires only one entry to update all the other related modules. For example,
when the user records a sale in the A/R module, the inventory will
automatically show a reduction in the items sold. When the user records a
purchase in the A/P module, the inventory will be automatically increased.
4. The computer system automatically prepares financial statements.
5. A manager can use the accounting reports for forecasting and budgeting
purposes.
6. The computer performs all calculations at super speed with accuracy as long
as the initial entries are accurate. For example, the computer calculates the
total amount of the invoice by multiplying the selling price by the number of
items sold. Added to this amount is the calculation of the sales tax due. The
numerous payroll calculations are another example.
7. Fast manipulation of data makes management decision making easier,
leading to profitability, possible reduction in the sales price, or purchase of
more items at a better rate.
8. Neater and more accurate reports are produced with no crossed out figures
and white out on reports.
Computerized Accounting Disadvantages
1. It is harder to locate and correct errors until the user learns the particular
characteristics of the program.
2. If the user enters incorrect information, all automatic calculations will be
incorrect. For example, if the sales tax percentage is incorrect all the invoices
will be incorrect. A first-time user might assume the computer calculations
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are correct and not check the total of the invoices before sending them out.
3. Many computer programs do not leave an adequate audit trail to follow. This
feature must be built into a program.
4. Management gets caught up in the need for the most current revision or the
fastest program. The user wastes many hours and dollars reentering all the
data. If the current program serves the company’s purpose, changing the
program is unnecessary.
5. Software manufactures do not always write manuals that present clear and
concise instructions. Learning the program may require more time in the initial
months. Better analysis of the program at the time of purchase could
minimize this disadvantage.
6. The cost for initial purchase of hardware and software may cause a shortterm cash flow problem.
7. Training on the particular computer and software is necessary. The cost of
training could be written into the purchase agreement of the software.
CONVERTING FROM
MANUAL TO
COMPUTERIZED
_________________
The user should consider several factors when deciding to computerize or
automate the business computer system. First, ask, “How many transactions are
completed during the accounting period?” The break-even point between using
the manual method and computerizing the accounting records is twenty-five
transactions.
L.O.11
The cost of buying the computer system and the accounting program, plus paying
an individual to learn the program, is very high. If the owner of a small business
is not computer literate, it might be better to contract out the bookkeeping function
or the write-up work (entering transactions in the books). The short-term costs of
the computer system must be weighed against its long term benefits.
The user should make sure that the accounting records are reconciled and in
good shape before converting to an automated accounting system. If incorrect
information is entered into the setup data it is very difficult to correct. Remember,
“garbage in, garbage out” (GIGO).
The first step in buying an accounting program is to ask "What do I want the
program to do for me?" Once that question is answered it will be easier to select
the program.
When selecting the accounting program system though a software vendor, the
user should locate a person knowledgeable in computerized accounting
programs, not just any salesperson. The user should bring to the software store:
1. A sample of each type of source document.
2. A copy of the month-end reports.
3. An idea of how the company will grow in the future.
The user should be able to enter a few transactions and print a few reports before
purchasing any programs.
Once the system has been selected, both manual and computerized systems
should be run in parallel to make sure that all the information is recorded, printed
out, and agrees with the original system’s output (Figure 1.13). This is called
”parallel processing.” Parallel processing of the transactions also provides a
dollar amount to compare the reports of each system. If there are errors, this
procedure will allow time to set up error-checking procedures that will ensure
accuracy and correct any "bugs the software may have. The user should perform
parallel processing until computer data can be relied on. This can take from one
to several accounting periods.
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FIGURE 1.13
Parallel Processing
The user should convert one module at a time. Many companies convert all the
modules at once and have a difficult time. If there is an error in one module it will be
automatically integrated to the General Ledger.
Automating one module at a time allows the user to learn the program and make full use
of its features with limited errors. Companies are most likely to start with the General
Ledger due to the posting and financial statement features. Until the module is
converted, summary transactions will need to be entered as journal entries in the
General Ledger. Once a module has been converted, the summary transactions will be
sent automatically to the General Ledger or integrated.
Learning the General Ledger makes converting all other modules easier. The user can
learn the basic organization of the program in the General Ledger and transfer this
knowledge to the other modules.
One exception to the parallel processing requirement is if the individual or company has
no system at all, or the system is creating incorrect information. In this case the user
should convert as fast as possible to provide accurate data.
There are four general types of accounting programs:
tutorial, personal
accounting, basic accounting, and high-end accounting.
Tutorial programs are used in the educational environment and have limitations to the
system. These limitations could restrict the date to one year, limit the number of disks, or
restrict the number of main file accounts. The purpose of this type of program is to
educate students in the basics of computerized accounting. Small businesses or
individuals can tailor tutorial programs like the enclosed Business works program for their
accounting functions.
Personal accounting (entry level) program are for the money management needs of the
individual family or small business. These programs use a Statement of Financial
Position instead of a Balance Sheet and Actual Costs versus Budgeted Cost instead of
an Income Statement. These programs usually have commands that prepare budgets,
write checks, reconcile checkbooks, and sometimes project personal income tax. The
cost of this type of program is usually $50-$100, depending on the features included.
Accounting
Software
Programs
L.O. 12
TUTORIAL
PERSONAL
Basic accounting (mid level) program usually include the five major modules: G / L, A /
R, A / P, Payroll, and Inventory –some even include job costing. Basic accounting
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programs are fully integrated and the cost is approximately $200-$900. These programs
include the basic and most common accounting features. However, they are mainly for
small to mid-size companies. The best method is to start out with a modestly priced
basic accounting program and then upgrade to the same software company’s high-end
accounting system when the business expands.
High-End accounting systems are complex accounting programs that handle large
numbers of transactions with detailed information. Each module sells separately. The
purchase of the General Ledger is a requirement for the purchase of any other module.
The cost per module is $1,000 and higher. There are more modules than the basic six,
such as Financial Analysis, Budgeting, Fixed Asset Management, Address Labels, and
User-Defined reports. Some programs allow individuals to sell modules that are
structured for a particular industry—such as for doctors, dentists, or apartment
managers. The complexity of high-end accounting programs means that they require a
large amount of memory on the hard drive.
BASIC
HI-END
Table 1.5 lists three types of computerized accounting programs that are available to businesses and some
examples of programs that fit into the type
TABLE 1.5
Computerized Accounting
programs
PERSONAL ACCOUNTING (ENTRY LEVEL)
MoneyCount
Quicken
Managing Your Money
Dollar and Sense
BASIC ACCOUNTING (MID LEVEL)
Profitwise
BPI
One-Write
Dac-Easy
ACCPAK Easy
Pacioli 2000
Simply Accounting (Bedford)
Business Works
Peachtree Complete
MYOB
Great Plains
Quickbooks Pro
HIGH-END ACCOUNTING
Solomon III
Accpak Plus
State of the Art
Lake Avenue
Source-Mate
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Software
Evaluation
Criteria
L.O. 13
TABLE 1.6
Basic Evaluation
Criteria Form
Before any software is purchased, all possible programs should be considered and
evaluated. The user should consider the criteria listed in Table 1.6
SOFTWARE EVALUATION CRITERIA FORM
Program Program
#1
#2
Program
#3
Modules Included
Capacity
Reports
Reports-User defined
Network Support
Speed
Ease of Use
Documentation
Ease of Learning
Error Handling
Data Integrity
Error Messages
Import/Export Data
Support
Technical Questions
software Questions
Cost ($)
Value for the Money
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SECTION 2: Business Works Users Guide- Basics
Business Works uses the standard Windows tools and commands. A review of a few of the screens and
commands will be presented.
FIGURE 1.14
Main Menu
Pull Down Menu
Screen Commands
Business Works uses the standard modules: General Ledger, Accounts Payable, Accounts Receivable,
Inventory, Order Entry, Payroll, Job Costing, Mailing Labels, and Systems Manager.
The Pull Down menu will change as you click on the module icon. Each module will have its own Pull Down
Menu. These will be discussed in the chapter on the particular module.
Selecting an
Option
To choose a different option use either of the following methods to select the
command:
Mouse - Click on the selected module, command or field
Cursor Movement Keys- Select the module, command or field using the up, down,
right or left arrow key.
Special Keys
The esc key will cancel any command that has been selected.
In any report the Home key will go to the beginning of the report and the End key
will go to the last page of the report. PgUp and Pg Dn will progress through the
report page by page.
The INS (insert) key and DEL, (delete) key can be used within any field line. The
BACKSPACE key will delete to the left and DEL will delete to the right.
If you want to insert character into a field without erasing what is already there,
press the INS key. The small blinking cursor changes to a large blinking cursor,
and any characters you type “push” characters to the right. If insert mode is
turned off, you type over existing characters.
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START-UP SCREEN
To bring the Business Works Main Menu to the screen the user must first entered the information required
from the start-up screen. After the user click the Business Works icon the start up screen appears. The user
selects the company to have the data entry. The date for the data entry is entered. This will be the default
date the program will use. The posting date will automatically be the report date unless changed. Be sure to
check the current date underneath the dates is the same month that you are using.
Select Company Name
Dates
FIGURE 1.15
Start up screen
Screen Commands
At the top right hand corner of the screen are three boxes. These boxes are quick ways of minimizing,
enlarging or closing the command or program.. Click on the box of the action you want to perform.
_
Minimize -
_
This places the command on the bottom tool bar. It does not
close the command just puts it aside for a while. If you try to
exit from the program you will get a message that will say that
other operations are opened and you will not be able to exit the
program. To solve this simply enlarge the command and use
the close box.
Maximize or enlarge - If you minimize you will need to enlarge to close it.
X
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Close -
Use to exit from each command and in the main menu you will
exit from the program. Be careful since at the main menu if this
is selected you must close. You cannot cancel this command
at the main menu.
1-26
Business Work Action Buttons
(See Descriptions below)
(from Screen Display)
Business Works uses a standard set of action buttons to perform the commands in all the
modules. The buttons on the bottom of the screen display are available with each data
entry screen.
Close
Minimize
Maximize
First Previous Next Lookup Undo
Last
Rename
Save Help
Delete
Attachment
New
FIGURE 1.16: Icon Descriptions
FirstPrevious NextLastLookupSaveUndoHelpRenameNewDeleteAttachment-
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Moves to the first main file
Moves backwards to the former main file
Moves forward to the next main file
Moves to the last main file
Displays a screen with a list of all the main files
Saves any changes or data entry made
Cancels whatever was entered and brings up a fresh screen
Provides some hints and information about the current screen
Allows the main file name change
Allows entry of another main file or transaction
Removes the file or transaction on the screen
To be discussed in Special Features Chapter
1-27
Print Options
Each module in Business Works has a reports command. Every report can be printed to three places:
Screen, Printer and File. The report can present the data as either detailed or summary. The time period of
the report can also be selected. It can be current, prior month, or prior year. Business Works retains at least
two years of data.
Select the Screen to view it before printing, once correct you can select the printer icon to
print the report.
Select Printer and choose the printer, or
Select File to save to a disk to use with another software program.
FIGURE 1.17: Report Device Selection Screen
Print Device Button-
Type of Report -
Detail – provides a list of the transactions
Summary – provides the totals only.
Reporting Period-
Two years of data will be retained. You can access several
different dates of data. Use Reporting Period to choose the
dates you want to see.
FIGURE 1.18: Report Print Screen
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DATES
Date entry fields are shown on the screen using a mask of the form MM/DD/YY. You
do not have to type the / characters; they are just there to ease your data entry. The
system will skip over them as you enter a date, or as you backspace.
DATES FORMAT and
ENTRY
You must keep all months as two digits. For example, January 15, 2005 would be
entered as 01/15/05. When you are required to enter a date, a default date will
always be entered in the field already. This is the current date or today's date. It is not
necessary to type over digits that will remain the same. You can press ENTER as
soon as the correct date shows on the screen. For example, to change 01/01/05 to
01/02/05, just type:
0102 ENTER or    2 ENTER
The Business Works accounting system uses three different chronologies to offer
users the greatest possible degree of flexibility in processing. Take a moment to
understand the terminology and how to use this information.
Your computer’s operating system keeps track of the actual date (and time),
incrementing it automatically based on the passage of time. This is known as the
system date. It will date all the files as they are changed. When the back-up copy is
made this date will be used.
SYSTEM DATE
The entry date is entered at the start-up screen. (See Figure 1. ) This is the date
Business Works uses to ”stamp” all your reports. The system time is also place on
the reports. This appears at the upper left hand corner of each report. This provides
a true indication of the sequence of events. Such a chronology would be useful if ever
you had to rebuild your activity from a backup copy.
ENTRY DATE
The entry date is useful since you frequently enter transactions “after the fact”. For
instance, you may hold all of you’re A/R invoices for a day, then enter them on the
following morning. When you encounter a field requiring that a date be entered, the
entry date will always be inserted. You can accept the default value by pressing
ENTER, or you can type over part or all of the date. The entry date can be changed
by clicking on the up or down arrow next to the date. The fastest way is to highlight
the field and retype the date.
While the system date normally would offer amore accurate chronology of processing
steps, transactions in this student project relate better to the fixed entry dates.
NOTE: Changing the entry date does not change the system date. Changing the
system date does not change the entry date. They are two separate values
stored in two separate places in your computer’s memory. The system date
changes automatically based on the passage of time. The entry date stays
the same until you change it.
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Logon to Business Works Program/Create a New Company( L.O. 15)
1.
Select the Business Works icon from the windows desktop.
2.
The Start-up screen will appear. Select the Company ID of the problem the is to be used.
(See Figure 1.19)
FIGURE 1.19: Company Selection Screen
3.
Click on OK. Make sure the Posting date is 07/01/XX. ( XX = previous year so the program
will not make it a future years transactions. In real practice this will always be the current year.)
When you press enter at the posting date it will also change the report date. Click on OK.
FIGURE 1.20: Start-up Screen
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4.
 Business Works Main Menu – Note Your Company Name at the top. This is very
important especially when making a back-up copy.
FIGURE 1.21: Business Works Main Menu Screen
Create a New Company(Also included on page 2-21)
1.
2.
3.
4.
5.
Select System Manager Module.
Select Maintenance.
Select Maintain Companies
Click OK at the bottom of the screen.
Click on the "New" Icon.
6.
In the ID field enter the name of the company with your initials. For example,
SUSYCK.
In the field for Company Name, enter the company name then your name. For
example, Susy's-Christy Kloezeman.
Select the Save icon.
When asked if you want to create a new company, select OK then close.
Select SWITCH COMPANY to the newly created company. This is very
important. If you do not switch you will be changing the incorrect company.
Remember to look at the top of the screen for your company name.
7.
8.
9.
10.
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To Exit Business Works
1.
From the Main Menu click on the Close Box X
2.
The program will ask if a back-up copy is desire. This is the best way to make a
back-up copy. If yes is selected a disk needs to be in Drive A. This procedure will
overwrite any data on the disk in Drive A. The Company data will be compressed
to fit on the 3 1/2" disk.
Figure 1.22 Back-up copy Screen
If no is selected the program will go to the desktop without making a copy.
Restore Business Works Data (L.O. 16)
1. From the main menu select System Manager.
2. Select Maintenance -- Restore.
3. Be sure your data disk is in A:
4. Select Restore from Utility Screen.
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5. Select Browse to select the A drive. Click on A.
Click on each sucessive folder until a file name with a date appears in the File (*.*) box.
Select OK.
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6. Click on dated data box by the file name. This will place a  in the box.
7. Select Restore.
8. Restore your data to original location ID. Be sure to see that restore has the current
drive.
9. Click OK.
10. Click the close box.
11. Select Switch Company from the Utilities Menu.
12. The start-up menu will appear. Select the company you just restored.
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13. Back-up? No. This is the sample company. Don't do it or you will lose the data on
your back-up copy.
Back - up Copy of Data or Archival Disk
1.
2.
The best way to make a back-up copy is to close the program using the Close box.
The program will ask if a back-up copy is desire. If yes is selected a disk needs to
be in Drive A. This procedure will overwrite any data on the disk in Drive A. The
Company data will be compressed to fit on the 3 1/2" disk.
Back-up copy Screen
3.
4.
NOTE: If the system manager is used to make a back-up copy, a copy of the
system will also be made, thus requiring 2 disks--one for the system and one for the
data. This method is not recommended for the data in this text.
The back-up copy can be used as an archival disk is created before the end of
month procedure is performed. The archival disk should be stored in a safe place
for possible future use.
COPY PROBLEM SCREEN INTO A WORD DOCUMENT
If you have a problem and would like the instructor to help, make a copy of the screen that
shows the problem. To do this follow these instructions:
1. Bring problem to screen.
2. Press the PrtSc key. This place the screen onto the clipboard.
3. Open a new word document.
4. Make sure the cursor is on the blank word document.
5. Press Ctrl+V or edit-paste to place the screen into the word document.
6. Print the document to show to the instructor.
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SECTION 3: Student Application - Installing Program and data
The Trial Version of the Business Works program and data is produced by Sage Software. Sage software
produces several other software programs that can be used with the Business Works program. This Trial
Version is the full version but without registration will only last for 30 days from the date of the data creation.
You will be given the current command to enter to extend the 30 days to 120 days from data creation.
Learning Objective 17:
STEP BY STEP INSTRUCTIONS FOR
INSTALLATION OF THE BUSINESS WORKS TRIAL VERSION PROGRAM
1. Place the CD in your CD Drive. In a few minutes your screen will show the BW
Installation Screen. Be sure to turn on your speakers to hear the instructions.
2. Click on first Button to Install Business work.
3.  Full Y2K - Compliant screen.
Click on Install
Welcome Screen -- click on Next
4.
Select Destination Directory
C:\BW
Click Next
5.
Select Modules: Select all, then Click on Next.
6.
Ready to Install -- Next.
7.
 Copy files  Sage BW Icon appear.
8.  Copy files. Takes a while.
9. BW Custom office Background, Installation complete, click on finish.
10. Restart the system. Select OK.
11. Double click on Sage BW version 12.9
12. BW Start-up.
13. Company ID Sample.
14. Posting/Report date 07/01/0X.
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15. The main menu appears:
16. From the main menu select System Manager.
STEP BY STEP INSTRUCTIONS TO RESTORE (INSTALL)
DATA DISKS . Install on your personal computer the company data
that was created in the classroom.
17. Select Maintenance -- Restore.
18. Be sure your data disk is in A:
19. Select Restore from Utility Screen.
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20.
Select Browse to select the A drive. Click on A.
21.
Click on each sucessive folder until a file name with a date appears in the File (*.*)
box. Select OK.
22. Click on dated data box by the file name. This will place a  in the box.
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23. Select Restore.
24. Restore your data to original location ID. Be sure to see that restore has the C: drive.
25. Click OK.
26. Click the close box.
27. Select Switch Company from the Utilities Menu.
28. The start-up menu will appear. Select the company you just restored.
29. Back-up? No. This is the sample company. Don't do it or you will lose the data on
your back-up copy.
30. Enter 07/01/XX as your date.
31. The Main Menu appears.
32. Repeat the Installation of data steps (17-30) for the Dr. Detail Data disk and/or ABC
Company.
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SUMMARY
In this chapter the activities in the accounting cycle were discussed to help
the student understand why certain commands were used. The structure of
parts of a computerized accounting system structure were given as
modules, commands, and fields.
The six main modules and their primary files were presented. These were
General Ledger—Chart of Accounts, Accounts Receivable—Customer File,
Accounts Payable—Vendor File, Payroll—Employee File, Inventory—Item
File, and Job Costing—Employees/vendors/inventory. Other auxiliary
modules were given.
The four main commands in any maintenance file were given as ADD,
CHANGE, DELETE, and DISPLAY or VIEW.
Analyzing source documents and using input forms were presented as ways
of handling the data input. The two input modes that were discussed are
batch and on line/real-time processing.
Passwords were discussed and changing them frequently was advised. The
need for backup copies of the data was stressed.
Activities in the manual accounting system were compared to computerized
accounting system activities. How to convert from manual to automated
accounting was discussed. The advice to convert one module at a time was
given.
Four types of accounting programs were identified. How to evaluate the
accounting programs was also presented. The Business Works program
was introduced, giving the hardware configuration that can be used with this
program. A Chart of Commands of the Business Works program is provided
on the back inside cover of the text, helping the student see what options
are available. A user’s manual was also included for the student’ use.
Direction to install the trial version of the program and the data disks were
provided in step-by-step format.
Steps to log-on and exit the program were given.
In this chapter the student has learned about the various accounting
programs and the Business Works program in particular.
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Key Terms
A list of terms appears below. Find
these terms in the text and review
them to understand the section.
Account Name
Accounting Number
Accounting Cycle
Accounting Programs
Tutorial
High-End
Basic
Personal
Add
Backup Copy
Batch Entry
Change
Check Register
Coding
Command
Converting
Dates
System
Entry
Current
Delete
End of Period Processing
End of Year Processing
Fields
Field Editing
Function Keys
Hard Copy
Input Form
Insert Mode
Main Menu
Maintenance
Module
Narrative Transaction
Parallel Processing
Password
Real Time Processing
Record
Reference
Reports
Screen Saver
Soft Copy
Source Documents
Templates
Transaction
User’s Guide
View
Write-up Work
1.
2.
3.
4.
5.
6.
7.
8.
9.
List the six standard computerized accounting modules
What are the four option that can be performed on any maintenance file?
Give an example of a source document.
In order to do write up work what must the client provide?
What should be done with the source documents when doing write-up work?
What are the two data entry modes?
All modules are integrated to the ___________________________.
What activity does the computer perform at end of month? At end of year?
Once you have set the password, what do you need to know in order to
change the password?
10. What two activities must be performed by both the manual and computerized
methods?
11. With what activity is the computer the most help?
12. List three advantages of automating the accounting books.
13. List two disadvantages of maintaining the company’s books on the computer.
14. When converting from manual to automated a company should not ________
15. List the four types of accounting programs.
16. What is the entry date?
17. The current date is obtained from _____________________________.
18. What is the system date?
CHAPTER 1
REVIEW
QUESTIONS
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1.Give an example of an automatic command. _____________________
SELF-EXAMINATION
QUESTIONS
2.Match the type of accounting program with its definition.
1. Personal accounting (entry level)
2. Basic accounting (mid level)
3. High-end accounting
4. Tutorial accounting
__________ Used in an educational environment and generally has limitations.
__________ Complex accounting program that can handle large amount of
transactions. Each module is purchase separately.
__________ Include the five basic modules with integration. Good for a mid-size
company.
__________ Includes only the General Ledger module and can be used for the
home as well as a small business.
3.
Match the module where the following reports would appear:
___________ Purchases Journal
___________ Cash Receipts Journal
___________ Vendor List
___________ General Journal
___________ Price List
___________ Aged Accounts Payable
___________ Sales Journal
___________ Physical vs Perpetual Report
___________ Chart of Accounts
___________ Check Register
___________ Customer List
___________ Cash Disbursement Journal
A=G/L B=A/R C=A/P D=Inventory
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