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A businessman must keep records of the money he takes in and the money he spends. The work of keeping such records is called bookkeeping. The work of deciding how the records should be set up is called accounting. An accountant also finds out, by studying the records, whether or not a business is doing well. The accountant must know many things about the business.
Suppose a man owns a small clothing store, he keeps records that show that he spent money for newspaper advertising and for suits, shirts, shoes, and neckties to sell to his customers. He had to pay a young man to help him in the store. He also paid rent and had other expenses.
At the end of the year, he must take an inventory. That is, he counts how many pieces of clothing he has on hand. Then he must find out exactly how many he sold, how much money he took in, and how much money he spent in running the business. If he took in more than he spent, he made a profit for the year. If he spent more than he took in, he suffered a loss. He depends on his store accounting records to get all this information.
The owner of a small clothing store can keep records without much trouble. But a big oil company or a big bank has many difficult accounting problems. The company must know how much money is to be paid by its debtors and how much it owes other companies for supplies. It must know how much it has lost in depreciation, or wear and tear of its equipment. All of this information must be kept in the company's accounts. Big companies employ many accountants.
After a company's accountants finish their yearly count, their work must be officially examined. Experts from outside company double-check the records to be sure the accounts are correct.
1. According to the passage, a clothing store owner needs to keep records of the money he spends for ______.
A. clothing only B. newspaper advertising
C. all necessary expenses D. housing
2. After taking an inventory, if the owner found that he had got more money than he had spent, he made _______.
A. a profit B. a loss
C. an income D. an interest
3. A small store owner can usually keep records _______.
A. with difficulty B. easily
C. without any help D. without working
4. In big companies, after the accountants finish the yearly count, _______.
A. the work will be well done B. no one will check it
C. the records will be finished D. experts will check the records
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