Accounting: A Bigger, Better Bookkeeper
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A short evolution of accounting: from counting rocks in a cave, to lined paper, to computer and software. All hail the Quickbooks gods!
Courses | Accounting |
Language | English Language |
Transcript
that to count up Not very but there's a food
chain in counting beans at heart bookkeepers Arthuis data gatherers
They assess what the actual numbers are E How many
bushels of corn were claimed to have been sold And
are there really four hundred cash dollars in the cigar
box At the end of the day they're like anyone
stealing anything Well in today's parlance bookkeepers a lower order
form of accounting would check to see what checks were
written this month and actually cleared the bank deposit system
without bouncing And for the ones that did bounce well
they'd execute a series of actions to hopefully in the
future collect that money and well he eventually ending with
a write off AII the money was never there or
the guys with the baseball bat were in fact successful
And then the money was collected and then went through
regular channels Yeah well book keepers have very narrow functionary
activities where they glean from multiple sources the basic information
and make sure that the revenues and expenses are loaded
into the system That's it It's kind of robotic They
don't really think broadly They just gather the data type
it in lather rinse Repeat well Accountants meanwhile are the
philosopher kings of this process They must actually uh what's
it called Oh yeah Think If Shmoop sold for one
hundred twenty dollars a one year subscription to its premium
product and the check cleared and was cashed Well what
is shmoop recognizes revenues Well the bookkeeper just deposited one
hundred twenty bucks into the Shmoop Wells Fargo account But
the one year subscription comes with a money back guarantee
for the first month thinking alert must think Answer not
obvious So while the bookkeeper just types in those numbers
Accountant has to figure out when and how to recognize
the dough Does she look at it like it's revenues
when the check is deposited Well what if the check
then bounces revenues Well what about when the check is
cashed But then also clears Is that then revenues or
well is that in fact just cash flow but not
revenues Well the answer just as it always is like
with diapers Yeah depends a number of people who make
us sad We'll ask for their money back from Shmoop
That's about one in five hundred Well using Gap we
must recognize the most conservative approach in terms of estimating
how many people will ask for their money back So
maybe we hold is a separate line item and allowance
for doubtful accounts and rich turns I eat people who
just want to get their money back and go away
quietly Or maybe we recognize no revenues until that first
month has entirely passed just to be on the extremely
safe side Then the accountant figures out whether they recognize
a hundred twenty dollars divided by the eleven remaining months
there to calculate the revenues Or maybe there's something else
like What about this What about alternatively we apply Gap
The accountant could then divide that hundred twenty dollars by
twelve and simply hold as a quote reserve account unquote
one month worth of subscription revenue Back that out right
As things clear and things were okay no one wants
their money back Then Everything is happy right So yeah
bookkeeping is just keeping the books Bookkeepers add up numbers
and columns neatly and accurately and the accountant conducts The
analysis is of that data Heavy thinking non robot replacing
next year stuff Okay so to really drive home this
idea a couple more examples Oh website has been selling
one hundred hair clips a week for five years Then
suddenly they sell ten thousand clips in one week Or
at least they get a request to ship ten thousand
of them to a P O box in Russia All
the bookkeeper just sends along the sales of ten thousand
and goes home at five o one p M The
accountant gets this number and things How do you say
my sight got hacked in Russian All right Another example
A sales person buys billboard ads to market their product
is not a cross of operating the business Or is
it a cost that should be directly associated with that
sales persons product Like there's lots of sales peoples in
the company but only that guy bought it So what
do you do with it How do you think about
that is an expense Will accountants make logical decisions about
where the right numbers go On a financial statement A
bookkeeper friendly just wouldn't care Yep we're sure some of 00:04:33.029 --> [endTime] them are very nice people though