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Accounting Cycle for La Rue Catering
La Rue Catering is a small catering company owned and operated by an acquaintance of mine, name Keri. La Rue Catering is located in a middle class neighborhood. Keri mainly caters weddings, birthdays and anniversaries. La Rue Catering caters and decorates for parties and special occasions. The owner works out of her home, where she has a storage room with all the products and foods for the business. The company is operated and managed by the owner (Keri) and has one full-time employee, who is a great support for Keri. Whenever Keri needs additional help for food preparation or service, she uses temporary staff through and outside agency. La Rue Catering accepts two major forms of credit cards, Visa and MasterCard, along with cash; however they do not accept checks. Keri has a very simple accounting cycle to ensure she is keeping the proper accounting records for tax purposes, book keeping purposes and to ensure she is not breaking any tax laws. In this paper I will discuss the accounting cycle that Keri utilizes in her catering company.
Accounting Cycle
The first major step in the accounting cycle is proper record keeping. Keri utilizes software called QuickBooks. QuickBooks is software utilized by many small business owners; it is inexpensive and allows the business to function smoothly throughout its accounting cycle. All inventory is imputed into QuickBooks,...
This allows her quick access to inventory knowledge. QuickBooks automatically deducts any item from the inventory once it is utilized. Keri does not keep much inventory on hand, however finds it easier to make large purchases of non-perishable items such as napkins and utensils.
All transactions such as booked occasions or completed occasions are entered into the computer (QuickBooks). At the end of any business week, Keri must complete her accounting cycle. In this type of business there not daily transactions, however on any day that Keri conducts transactions, the first step is identifying each transaction or recognizable event for the day. At the end of each month, Keri must prepare the transaction log, which differentiates the different transactions, such as credit, debit or log of inventory. The classification and balancing of the store finances is the next step. Keri must ensure that she, separates credits, debits and inventory, credit card transaction and cash. Any cash collected, must match her deposit slips and computer program. Keri keeps a manual journal, where she enters the necessary information as a back-up, which allows her separate incoming cash for the transactions, credits, debits and expenditures. Once her journal is balanced and everything is updated, she files…
References
The accounting process. (2010). Retrieved on November 19, 2010 from http://www.netmba.com/accounting/fin/process
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