Bookkeeping and records

Understand accounts payable, payment schedules and the difference between entering a supplier bill and paying it from your business bank account.

Accounts payable turnover shows how often a business pays its suppliers in a year. See the formula, a worked example and why higher is not always better.

What accounts receivable means, how an aged receivables report helps, and why invoiced revenue can leave a profitable business short of cash.

Accounts receivable turnover shows how many times a year a business collects its customer balances. See the formula, an example and what the result can mean.

Learn how accrual accounting records income and expenses, how it differs from cash timing, and why choosing a reporting method is not just a software setting.

Accrued expenses are costs you have incurred but not yet been billed for or paid, such as wages, interest and utilities. Learn how they work at year-end.

Accrued revenue is income you have earned but not yet invoiced or collected. Learn how it differs from accounts receivable and when it matters at year-end.

An allowance for doubtful accounts is an estimate of unpaid customer invoices you may not collect. See how it works, an example and how it differs from tax rules.

What an audit trail is in accounting, how it links a reported number back to source documents, and what Ontario businesses should keep to support it.

Bad debt is money a customer owes you that you have determined you will not collect. Learn how the income tax and GST/HST treatment of a write-off works.

What a bank feed is, what it brings into your accounting software, where it goes wrong, and why it does not replace statements or reconciliation.

Learn what a bank reconciliation checks, why matching a feed is not enough, and which differences an Ontario business owner should investigate.

Understand bookkeeping, the records behind reliable accounts, and how it differs from bank feeds and year-end tax work for Ontario business owners.

Cash basis accounting records income when money is received and expenses when paid. See how it differs from accrual accounting and when Canadian tax rules allow it.

A plain-language explanation of the chart of accounts, with examples of useful categories and common classification mistakes in small-business books.

Cost of goods sold is opening inventory plus purchases minus closing inventory. See an example, why inventory counts matter and how it fits on Form T2125.

Learn what debits and credits mean in bookkeeping, which accounts each side increases, and why a bank statement can seem to say the opposite.

Deferred revenue is money received before you have delivered the product or service. Learn why deposits, retainers and subscriptions start as a liability.

What double-entry bookkeeping is, why every transaction is recorded twice, what that check catches and misses, and what to ask about your system.

What counts as an electronic record for CRA purposes, how long to keep them, what must stay readable, and what to check before changing software.

What a general ledger is, how it relates to the chart of accounts, subledgers and the trial balance, and what to check before relying on it.

Inventory is the goods a business holds for sale or to make products. Learn the types, how it appears on the balance sheet and why counts and records matter.

Inventory valuation sets the dollar value of unsold stock. See the two CRA methods, why consistency matters and how the closing figure changes your profit.

What a journal entry is, how debits and credits work, how recurring and adjusting entries differ, and what documentation each entry should carry.

Month-end close is the routine of checking and finalizing a month’s records so reports can be trusted. Learn the steps and what an Ontario owner should expect.

Petty cash is a small amount of cash kept for minor business costs. Learn how to track it, what receipts to keep, and how it fits into Canadian records.

Prepaid expenses are costs you pay before you receive the benefit, such as rent or insurance. Learn how they are recorded and when the deduction is claimed.

What source documents are, which ones support each type of entry, what a receipt should show, and how long Ontario businesses generally keep them.

What a subledger is, which accounts usually have one, and how to check it agrees with its control account in the general ledger for an Ontario business.

What a suspense account is, why it should hold items only briefly, and how Ontario business owners can clear unexplained transactions before year end.

A trial balance lists every ledger balance to check debits equal credits. Learn what it proves, what it cannot, and how adjusting entries come next.

What year-end cut-off means, how it decides which period a sale or expense belongs to, and the checks to run around your fiscal year-end.