BOOKKEEPING BASICS
LECTURE NOTES STUDY
MATERIAL 2026 UPDATED
ACCOUNTING FUNDAMENTALS
EXAM REVIEW GUIDE
,What is Accounting Equation? - CORRECT ANSWER -Assets = Liability + Equity
Define Assets - CORRECT ANSWER -Resources owned/ controlled by a business
that will benefit the business.
Define liabilities - CORRECT ANSWER -amounts of money you owe/ business
owea
Define Business Equity - CORRECT ANSWER -Equity is the owners stake in the
company. How much they have invested or withdrawn from the business.
What is the difference between accounting and bookkeeping? - CORRECT
ANSWER -A bookkeeper's job is to record transactions in the books of an
entity. An accountant's job is to use the information given by bookkeepers to
prepare financial statements.
What is double-entry bookkeeping? and why is it used? - CORRECT ANSWER -
Double-entry bookkeeping is a bookkeeping system that records each
transaction twice. This is by displaying a positive and negative financial effect.
This means that positives should equal negatives in the end making it far easier
to identify any errors.
,What is a ledger? - CORRECT ANSWER -A ledger (usually referred to as the
general or nominal ledger) is a book or computer system that contains a
number of accounts, each having a 'debit' and a 'credit' side, which are used to
record each transaction.
Why is it important for an accountant to understand bookkeeping? - CORRECT
ANSWER -The accounts in the ledger are used to create the financial
statements. The bookkeeping system gives a more detailed overview of how
the figures on the financial statements are made. The accountant will need to
look at and understand the books in order to check for and most likely make
adjustments.
What is the 'dual aspect concept'? - CORRECT ANSWER -The dual aspect
concept is that each transaction has 2 effects, as a transaction means that
there is a loss from somewhere (one account) in order for there to be a gain
elsewhere (another account). Double-entry bookkeeping uses this concept by
recording the movement of the transaction.
What determines whether an account should be debited or credited in a
transaction? - CORRECT ANSWER -The account credited is the account where
the money comes from. The account that money goes to is then debited.
Accounts payable - CORRECT ANSWER -Money a business owes to others for
goods or services.
, Accounts receivable - CORRECT ANSWER -Money that is owed to a business
for providing a good or service.
General bookkeeping responsibilities - Record financial transactions - CORRECT
ANSWER -Document all financial transactions in the appropriate books or
software to ensure accurate records of income and expenses.
General bookkeeping responsibilities - Reconcile bank accounts - CORRECT
ANSWER -Match and verify the business's financial records with its bank
statements to ensure consistency and accuracy.
General bookkeeping responsibilities - Manage accounts receivable and
accounts payable - CORRECT ANSWER -Track money owed to the business
(receivables) and money the business owes to others (payables) for efficient
cash flow management.
General bookkeeping responsibilities - Work with tax preparers and assist with
tax compliance - CORRECT ANSWER -Collaborate with tax professionals to
ensure that the business meets tax obligations, including accurate filings and
adherence to regulations.
General bookkeeping responsibilities - Generate financial statements -
CORRECT ANSWER -Prepare key financial reports like income statements,
LECTURE NOTES STUDY
MATERIAL 2026 UPDATED
ACCOUNTING FUNDAMENTALS
EXAM REVIEW GUIDE
,What is Accounting Equation? - CORRECT ANSWER -Assets = Liability + Equity
Define Assets - CORRECT ANSWER -Resources owned/ controlled by a business
that will benefit the business.
Define liabilities - CORRECT ANSWER -amounts of money you owe/ business
owea
Define Business Equity - CORRECT ANSWER -Equity is the owners stake in the
company. How much they have invested or withdrawn from the business.
What is the difference between accounting and bookkeeping? - CORRECT
ANSWER -A bookkeeper's job is to record transactions in the books of an
entity. An accountant's job is to use the information given by bookkeepers to
prepare financial statements.
What is double-entry bookkeeping? and why is it used? - CORRECT ANSWER -
Double-entry bookkeeping is a bookkeeping system that records each
transaction twice. This is by displaying a positive and negative financial effect.
This means that positives should equal negatives in the end making it far easier
to identify any errors.
,What is a ledger? - CORRECT ANSWER -A ledger (usually referred to as the
general or nominal ledger) is a book or computer system that contains a
number of accounts, each having a 'debit' and a 'credit' side, which are used to
record each transaction.
Why is it important for an accountant to understand bookkeeping? - CORRECT
ANSWER -The accounts in the ledger are used to create the financial
statements. The bookkeeping system gives a more detailed overview of how
the figures on the financial statements are made. The accountant will need to
look at and understand the books in order to check for and most likely make
adjustments.
What is the 'dual aspect concept'? - CORRECT ANSWER -The dual aspect
concept is that each transaction has 2 effects, as a transaction means that
there is a loss from somewhere (one account) in order for there to be a gain
elsewhere (another account). Double-entry bookkeeping uses this concept by
recording the movement of the transaction.
What determines whether an account should be debited or credited in a
transaction? - CORRECT ANSWER -The account credited is the account where
the money comes from. The account that money goes to is then debited.
Accounts payable - CORRECT ANSWER -Money a business owes to others for
goods or services.
, Accounts receivable - CORRECT ANSWER -Money that is owed to a business
for providing a good or service.
General bookkeeping responsibilities - Record financial transactions - CORRECT
ANSWER -Document all financial transactions in the appropriate books or
software to ensure accurate records of income and expenses.
General bookkeeping responsibilities - Reconcile bank accounts - CORRECT
ANSWER -Match and verify the business's financial records with its bank
statements to ensure consistency and accuracy.
General bookkeeping responsibilities - Manage accounts receivable and
accounts payable - CORRECT ANSWER -Track money owed to the business
(receivables) and money the business owes to others (payables) for efficient
cash flow management.
General bookkeeping responsibilities - Work with tax preparers and assist with
tax compliance - CORRECT ANSWER -Collaborate with tax professionals to
ensure that the business meets tax obligations, including accurate filings and
adherence to regulations.
General bookkeeping responsibilities - Generate financial statements -
CORRECT ANSWER -Prepare key financial reports like income statements,
