Tour and travel
This query is : Resolved
18 January 2013
please search for accounting manual for tour and travel industry on google.
18 January 2013
When you start a travel agency, you need to keep accurate accounting records for your business. These records help you keep track of your agency's performance and are necessary for preparing your tax return. The most important accounting procedures for a travel agency are the cash flow statement, the general ledger and the income statement.
Cash Flow Management
One of the most basic goals of your accounting procedures is to keep track of your agency's cash flow. While running a travel agency with multiple daily transactions, it can be easy to lose track of your sales and your incoming payments. Through the use of your accounting software, you can keep track of your company's net cash flow from sales and expenses. This keeps track of the cash management of your business and helps identify any financial problems. Make sure that your agents post all business transactions in your accounting records.
General Ledger
Another accounting tool for a travel agency is the general ledger. The general ledger gives an overview of your company's current position. This ledger keeps track of your agency's assets, everything your company owns and what it owes. The accounting impact of all business transactions should be recorded on your general ledger through your accounting software. Most businesses update their ledgers daily or weekly. It is crucial to update your general ledger regularly so you can keep track of your agency's financial status.
Recognizing Revenue
An important accounting procedure for any business is the process of revenue recognition. This principle establishes when a business has officially earned revenue and can declare the earnings on its accounting statements and for taxes. A travel agency, as a service industry, must use the cash method for recognizing revenue. Your agency must recognize revenue as earned as soon as a payment is received. It does not matter when you complete your service to the customer, as soon as you receive payment, you must recognize the payment as revenue.
Income Statement
The last accounting procedure for running a travel agency is the maintenance of an income statement. The income statement records your total income and expenses to calculate your net profit over a period of time. The income statement serves a similar purpose as the cash flow statement. While the cash flow statement only keeps track of cash, the income statement measures the profits of your business. When you start your agency, the cash flow statement is more important as you get the handle of your company's daily cash flow. In the long-run, your income statement is more important as it gives a better description of your company's total profitability.
Cash Flow Management
One of the most basic goals of your accounting procedures is to keep track of your agency's cash flow. While running a travel agency with multiple daily transactions, it can be easy to lose track of your sales and your incoming payments. Through the use of your accounting software, you can keep track of your company's net cash flow from sales and expenses. This keeps track of the cash management of your business and helps identify any financial problems. Make sure that your agents post all business transactions in your accounting records.
General Ledger
Another accounting tool for a travel agency is the general ledger. The general ledger gives an overview of your company's current position. This ledger keeps track of your agency's assets, everything your company owns and what it owes. The accounting impact of all business transactions should be recorded on your general ledger through your accounting software. Most businesses update their ledgers daily or weekly. It is crucial to update your general ledger regularly so you can keep track of your agency's financial status.
Recognizing Revenue
An important accounting procedure for any business is the process of revenue recognition. This principle establishes when a business has officially earned revenue and can declare the earnings on its accounting statements and for taxes. A travel agency, as a service industry, must use the cash method for recognizing revenue. Your agency must recognize revenue as earned as soon as a payment is received. It does not matter when you complete your service to the customer, as soon as you receive payment, you must recognize the payment as revenue.
Income Statement
The last accounting procedure for running a travel agency is the maintenance of an income statement. The income statement records your total income and expenses to calculate your net profit over a period of time. The income statement serves a similar purpose as the cash flow statement. While the cash flow statement only keeps track of cash, the income statement measures the profits of your business. When you start your agency, the cash flow statement is more important as you get the handle of your company's daily cash flow. In the long-run, your income statement is more important as it gives a better description of your company's total profitability.
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