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Acc 101 by Amedu Babangida

By Amedu Babangida

Summary

Differences between computerized accounting system and Manual Accounting system are listed below:
Acc 101 by Amedu Babangida
 
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Abstract

NAME: AMEDU BABANGIDA

REG NO.: 66076435IJ

DEPT: AGRIC. BUSINESS

COURSE OPTION: AGRIC BUSINESS MANAGEMENT

COURSE CODE: ACC101

LEVEL: 100

Differences between computerized accounting system and Manual Accounting system are listed below:

i. Speed: The main difference between manual and computerized systems is speed. Accounting software processes data and creates reports much faster than manual systems. Calculations are done automatically in software programs, minimizing errors and increasing efficiency. Once data is input, you can create reports literally by pressing a button in a computerized system.

ii. Cost: Another difference between manual and computerized systems is cost. Manual accounting with paper and pencil is much cheaper than a computerized system, which requires a machine and software. Other expenses associated with accounting software include training and program maintenance. Expenses can add up fast with costs for printers, paper, ink and other supplies.

iii. Backup: A third difference between manual and computerized systems is the ease of backup of a computerized system. All transactions can be saved and backed up, in case of fire or other mishap. You cannot do this with paper records, unless you make copies of all pages--a long and inefficient process.

iv. The ability to deal in multiple currencies easily: Many computerized accounting packages now allow a business to trade in multiple currencies with ease. Problems associated with exchange rate changes are minimized.

 

Option B The main advantages of a computerized accounting system are listed below:

i. Speed – data entry onto the computer with its formatted screens and built-in databases of customers and supplier details and stock records can be carried out far more quickly than any manual processing.

ii. Automatic document production – fast and accurate invoices, credit notes, purchase orders, printing statements and payroll documents are all done automatically.

iii. Accuracy – there is less room for errors as only one accounting entry is needed for each transaction rather than two (or three) for a manual system.

iv. Up-to-date information the accounting records are automatically updated and so account balances (e.g. customer accounts) will always be up-to-date.

Option C

The main advantages of a computerized accounting system are listed below:

i. Availability of information – the data is instantly available and can be made available to different users in different locations at the same time.

ii. Management information – reports can be produced which will help management monitor and control the business, for example the aged debtors analysis will show which customer accounts are overdue, trial balance, trading and profit and loss account and balance sheet.

iii. Legibility ­– the onscreen and printed data should always be legible and so will avoid errors caused by poor figures.

iv. Efficiency – better use is made of resources and time; cash flow should improve through better debt collection and inventory control.

v. Staff motivation – the system will require staff to be trained to use new skills, which can make them feel more motivated. Further to this with many ‘off-the-shelf’ packages like MYOB the training can be outsourced and thus making a particular staff member less critical of business operations.

vi. Cost savings – computerized accounting programs reduce staff time doing accounts and reduce audit expenses as records are neat, up-to-date and accurate.

vii. Reduce frustration – management can be on top of their accounts and thus reduce stress levels associated with what is not known.

 viii. The ability to deal in multiple currencies easily – many computerized accounting packages now allow a business to trade in multiple currencies with ease. Problems associated with exchange rate changes are minimized.

 

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