In This Chapter

The last few chapters have explained how to track the income and costs of sales for your primary product or service, but running a business involves a lot more expenses than just those related to inventory. This chapter explains how to record general operating expenses and costs related to your liabilities, such as interest payments.

Your general ledger would be enormous and probably unwieldy if you recorded every single transaction directly to it. Instead, most businesses have subledgers for various key accounts, such as Accounts Payable and Accounts Receivable. This chapter explains how to manage these subledgers and their relationship to the general ledger.