Accounting Basics:

Financial Basics
SAP Business One
Version 10.0

PUBLIC
Objectives

At the end of this topic, you will be able to:

 Discuss some general accounting conventions.

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Business Scenario

You are implementing SAP Business One at a new customer, OEC Computers:
 Your main contact in the customer site is the accountant, Maria.

 Maria asks about the way SAP Business One handles the financial accounting
processes.
 She wants to make sure she understands the big picture so she can report on
business results.

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Finance Basics

System Configuration

Master data

Warehouse management
Marketing &
Inbound Outbound
Purchasing Service
logistics logistics
Sales
Production

Financial controlling

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Automatic Journal Entries: Reflection Question

Standard

Sales Incoming
Sales Order Delivery A\R Invoice Deposit
Quotation Payment

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Automatic Journal Entries: Answer

Standard

Sales Incoming
Sales Order Delivery A\R Invoice Deposit
Quotation Payment

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When managing perpetual Inventory 6
A/R Invoice Journal Entry

Sales
Sales Order Delivery A\R Invoice
Quotation

Debit Credit

Customer
105
account

Tax account 5

Revenue
100
account
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The Account Balance

Customer
Debit Credit Origin
XXXX7

105 Debit A/R Invoice

600 Debit A/R Invoice

400 Debit A/R Invoice

705 Credit Incoming

Payment

200 Debit A/R Invoice

100 Debit A/R Invoice

Account
700 Debit
Balance

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Account Types

Debit Accounts Credit Accounts

▲= ▲=
increase Typical increase Typical
▼= Balance ▼= Balance
decrease decrease

Bank Account,
Assets ▲ Accounts ▼
Balance Sheet

Receivable
Accounts

Accounts
Liabilities ▼ ▲
Payable

Equity/ Capital ▼ ▲ Reserves

Rent,
Expenses ▲ ▼
Profit and

Accounts

Electricity
Loss

Sales
Revenues ▼ ▲
Revenue

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Value Exchange: Reflection Question

A\R Invoice

Debit Credit

Customer
440
account
Revenue
440
account

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Value Exchange: Answer

A\R Invoice

Debit Credit

Customer
440
account
Revenue
440
account

The two accounts increase their values: ▲

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Summary

Here are some key points:

The account balance represents: • The difference between the total debit
transactions and the total credit transactions
recorded for that account.

In each journal entry: • A certain account increases value and another

decreases value
• The debit side and the credit side balance.

Assets, Expenses, and Drawings • Debit

accounts are generally in:

Liability, Revenue, and Capital (Equity) • Credit

accounts are generally in:

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