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Accounting information systems development Essay

Category: Finance & Accounting Pages: 6 Type: Essay Level: Undergraduate
Instead, the billing and collections portions of the system will be computerized.
The System and Manual Functions (Inputs, Outputs, and Controls)
BusinessTown (2008) tell us to "Think of the accounting system as a wheel whose hub is the general ledger (G/L). Feeding the hub information are the spokes of the wheel. These include accounts receivable, accounts payable, order entry, inventory control, cost accounting, payroll, and fixed assets accounting." Each of these items is a subledger of the general ledger, and each summarizes the entries and then feeds that information to the general ledger.
There are a few differences between manual and automated ledgers. In order to consider this, think of the general ledger as a piece of paper that shows assets, liabilities, income, and expenses where all transactions are recorded by hand in a manual fashion. While some of the entries from the different subledgers flow upwards, others are entered manually through the utilization of a general journal entry. "The same concept of a sheet of paper holds for each subledger that feeds the general ledger. A computerized accounting system works the same way, except that the general ledger and subledgers are computer files instead of sheets of paper. Entries are posted to each and summarized, then the summary is sent up to the G/L for posting" (BusinessTown, 2008).
Billing is the first component that will be computerized at the firm. This will be highly beneficial to the organization since "Accounting firms can improve their profitability and relations with clients by automating client billing with computers. Accounting firms can use PCs as an economical means of