Software to Simplify the Accounting Cycle

Small Business Accounting Software and Double Entry Accounting

Jun 17, 2009 Miranda Miller

Following the nine steps in the accounting cycle is easier with software designed to automate the process of double entry accounting.

The nine steps in the accounting cycle help business entities ensure that their financial record-keeping complies with Generally Accepted Accounting Principles (GAAP). Small businesses may use an accountant at tax time, but struggle to maintain accurate and verifiable records throughout the year.

The following accounting software solutions help small business owners through the steps in the accounting cycle, from journalizing and posting transactions to preparing financial statements.

Microsoft Office Accounting Professional 2008

A highlight of the Microsoft accounting software offering is its ability to integrate with other Microsoft Office applications. Small business owners already comfortable with MS Word, Excel and Outlook will find the Accounting Professional interface familiar and simple to learn.

Microsoft Office Accounting Professional 2008 is also integrates with PayPal, Equifax and eBay. The inventory tracking and payroll systems are better suited for smaller businesses with few products and employees. Features include scheduled documents, a quick set-up interview, a resource center and adaptable transaction forms.

Peachtree by Sage Complete Accounting 2009

Peachtree accounting software features an in-depth set-up interview, for a highly customized program. The time-billing and payroll solutions are advanced, so the software lends well to service-based or consultancy businesses.

The inventory system suits businesses with a greater product selection and offers out-of-stock warnings, automated shipping methods, and custom options like different price levels. Peachtree integrates easily with a variety of other applications, including MS Word, UPS, and ACT!

QuickBooks Accounting Pro Edition 2009

This edition of QuickBooks is suitable for individuals and small to medium businesses. It supports over 100 different currencies, gives easy access to key financial data and company information, and even allows users to build a professional website with free hosting for up to three pages for one year.

QuickBooks' interface is clean, organized and easy to follow, with icons highlighting important, everyday tasks. New small business users will find a wealth of information and assistance in video tutorials and the QuickBooks Coach resource. This software solution is ideal for just about any type of small business, although those with substantial inventory will find the Peachtree offering more flexible in that area.

How Accounting Software Simplifies the Accounting Cycle and Double Entry Accounting

Programs like QuickBooks perform double entry accounting functions in the background. The software solution detects that a cash payment, for example, must be debited to an asset account and credited to a revenue account. This transaction increases both assets and owner's equity, which is reflected in the statement of owner's equity and the income statement.

Because the rules of double entry accounting are complicated, having a reliable program automate much of the process saves small businesses time, money and frustration. However, software is not a substitute for professional accounting services. New businesses should consult with an accountant in the planning stages, during start-up, and periodically to ensure the financial health of their business.

The copyright of the article Software to Simplify the Accounting Cycle in Accounting is owned by Miranda Miller. Permission to republish Software to Simplify the Accounting Cycle in print or online must be granted by the author in writing.