Original records like invoices, receipts, and bank statements that provide evidence of transactions. 2. Types of Accounting Systems
Businesses choose systems based on their size, complexity, and reporting needs: accounting system
A complete record of every financial transaction throughout the life of the company, categorized by account. Original records like invoices
An organized list of all account titles used to categorize every financial transaction. Liabilities (what you owe)
Every system tracks five core categories— Assets (what you own), Liabilities (what you owe), Equity (owner's worth), Revenue (income), and Expenses (costs).