Accounting Software Key Terms
Learn accounting software key terms to know which program is right for you
Most businesses in today's high-tech market depend on software to handle accounting functions. While accounting software does not eliminate the need for in-house accountants, it does assist them by reducing the amount of time accountants normally spend performing tedious tasks. For example, accounting software can break down job costs or maintain payroll records electronically. Learn how to optimize your company's accounting functions when you understand accounting software key terms.
Related Reading: Review more common accounting software terms.
Activity-based costing, or ABC
Activity-based costing, or ABC, is fundamental to most accounting software programs today. This method of costing was developed in the 1980s as an answer to the problems normally associated with traditional costing.
When businesses want a breakdown of the time, expense and sometimes even profit margin associated with individual jobs or projects, they use a job-costing analysis in their accounting functions.
Asset management software
Asset management software allows you to take control of fixed income and equity sources, current and cash liquidity, and infrastructure and real estate assets.
Wholesale distribution business
Accounting software usually includes capabilities to manage the wholesale distribution business end of a company.
Accounting software usually offers companies inventory management capabilities. This helps companies purchase just enough to fill customer orders but not so much that they have to absorb higher costs.
Integration of payroll
When accounting software programs allow the integration of payroll they are assuming all the roles performed by your payroll clerks and payroll specialists.
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