top of page
Definition of Accounting

Accounting is defined as the process of recording, Clasifying, summarising, analysing and interpretation of financial information of any entity.

General Process of Accounting

Entity Concept - Entity concept is to be applied first when we keep accounting of any entity. Entity concept implies that the Business keep the record of the owner in the same way as others while keeping the accounting records of the entity, For Example A Started business with Rs. 1,00,000, in Entity concept, Business is a kept separate from A, the owner of the business while keeping the accounts of the business in the same way as others. Means he will be treated as an Personal Account to which the rule of Debit the receiver and credit the giver will be applied in respect of all of its transactions including capital contributions and drawings from the firm/business.

Vijay Gulya.jpeg
Accounting Equations - Basics -Dual Concept of Transactions

All Financial Transaction has a dual System of Accounting. In other words we have to identify the dual aspect of transaction to record it. We have Capital and Liability and Liability on one hand and Assets on the other end. Each entry has dual impact either in the one side alone or on the other side or on both sides but making both the sides equal all the time. For understanding the effect of Accounting Transactions, we have the following example.

A Started Business with a Capital of Rs. 5,00,000
Assets    =        Capital 
He took a Loan from His Friend, Amar
Assets    =        Capital      +       Liabilities
He Purchases Goods to sell
Purchases + Cash + Bank + Fixed Assets    =   Capital + Sundry Creditors + Loan
When he sold the goods at Below or Higher of Cost and Make expenses and Incmes
Expenses +Sundry Debtors + Cash + Bank + Fixed Assets    =   Capital + Sundry Creditors + Loan + Expenses Payable

- Other Topics

--- Classification of Accounts

--- Rules of Personal Account, Real Accounts and Nominal Accounts

--- Making Journal Entries

--- Ledger Posting and Balancing the Ledgers

--- Periodic concept of Accounting

--- Trial Balance

--- Manufacturing, Trading and Profit and Loss Account

--- Balance Sheet / Statement of Affairs

--- Depreciation Accounting

--- Bank Reconcillations

--- Rectification of Mistakes

--- Final Accounts with Adjustments to Final Accounts

--- Accounts for Not for Profit organisations

--- Single Entry System of Accounting

bottom of page