Account Use

What is an account?

One definition of an account is a record in the general ledger that is used to collect and store debit and credit amounts. For example, a company will have a Cash account in which every transaction involving cash is recorded. If the company sells merchandise for cash, the Cash account will be debited and the Sales account will be credited.

          Another definition of an account is a record of a customer relationship. For example, if a company sells merchandise to a customer on credit, there seller will have an account receivable and the purchaser will have an account payable.

         The term on account means not for cash. For example, if a company purchases merchandise with the terms net 30 days, it means the company has 30 days in which to pay.

Account Definitions 5

 

1.      Accounting: Chronological record of changes in the value of on entity’s assets, liabilities, and owners’ equity, each of which is represented by a separate page in the ledger. See also accounting equation and accounts.

2.      Banking: Continuing financial relationship between a bank and a customer, in which deposits and debts are held and processed within a framework of established rules and procedures.

3.      Commerce: On-going contractual relationship between a buyer and seller whereby payment for goods received is made at a later time usually 30 days. See also charge account and open account.

4.      Law: Obligation of each party to a contract or partnership to account to other for amounts received or due.

5.      Services: Client of an advertising, brokerage, consulting, marketing, or public relations firm.

Use of Basic Savings Accounts

A savings account is the most basic account offered by banks today. It is an account that offers interest on the account, but it also has limited access to the funds. The only ways you can access the funds are through a withdrawal at the bank or at the ATM. Some banks may allow one or two transfers a month from the account, but these are often limited.

The interest rate on a normal savings account is fairly low. For this reason a savings account is good for a person who is just beginning to save money, and cannot meet the minimum balance requirements on a money market account.

If you are just opening your savings account, it is important to understand the minimum balance requirements. You should also check to see if you have a limited number of withdrawals each month. Banks may charge a fee with each withdrawal after the first three. You can set up automatic transfers and deposits into your account, which will help you to save money automatically.

You may consider setting up a savings account with an online bank. These accounts offer a higher interest rate. The banks can take up to three days to transfer the money to your local checking account. This means that you should only transfer money over that you do not usually need. This can be used to your advantage, if you struggle with impulse spending, because it forces you to spend time thinking about unplanned major purchases.

A savings account is a good place for your emergency fund. Since this is the amount that most emergencies will cost if you own a home you may need to increase that amount. After that you may consider putting the remainder of your emergency fund into other savings tools offered through your bank. This is a better option than using savings bonds or other investment tools when you start saving money.

What is a Bank Savings Account:

A bank savings account is a type of account designed to simply hold money that you do not need immediate access to. When contrasted with checking accounts, bank savings accounts tend to pay a slightly higher rate.

 Access to a Bank Savings Account

Savings accounts offer easy access to your cash. In other words, your money is liquid meaning you can make a withdrawal easily and quickly in a bank savings account. Note that savings accounts are not as liquid as checking accounts, because you can get money from a checking account by simply writing a check.

Use of Bank Savings Accounts:

When you have money in a bank savings account, your money earns interest.

This is a nice feature. Your bank savings account pays a rate of return on all the money in the account, That means that you get "paid" for keeping your money in the account. If you were not going to use the money anyway, then getting paid a little is better than nothing.

Bank savings accounts pay you more on your money than checking accounts.

Administrator account:

The standard account can help protect your computer by preventing users from making changes that affect everyone who uses the computer, such as deleting files that are required for the computer to work. We recommend creating a standard account for each user.

When you are logged on to Windows with a standard account, you can do almost anything that you can do with an administrator account, but if you want to do something that affects other users of the computer, such as installing software or changing security settings, Windows might ask you to provide a password for an administrator account.