Introduction to ALICE and POA

Accounting is the systematic recording, processing, storing, interpretation and

presentation of financial data relating to a business.
Modern accounting uses the double entry system. This system records the
amounts for each transaction twice i.e. in two different accounts.
A transaction refers to any exchange of values that the business is involved in. Any
account may be found in the ledger of the business.
All accounts fall into the following groups:
1. Assets - records of all things that belong to the business
2. Liabilities - records of amounts owed to outside parties
3. Income - records of earnings (sales) from business operations
4. Capital - records of owner inputs (capital) or withdrawals (drawings) from
the business
5. Expenses - records of services used by the business
Steps to follow when entering transactions into the ledger
1. Read the transaction
2. Name the accounts affected
3. Determine if the affected account is increasing or decreasing
4. Identify which groups the accounts belong to
5. Check your ALICE table

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