Accounting(Meaning & Concept)-MBA TOPIC

ACCOUNTING

MBAtopic in 2019| The size of the modern business has become so wide that it contains hundreds of thousands of commercial and billions of business transactions. It’s impossible to handle the business ventures by remembering the details of these transactions. Therefore, the orderly record of these transactions is kept, their ordering knowledge and experimentation are called accountancy only. The practical form of accountancy can be called accounting. According to the American Institute of Certified Public Accountants (AICPA) 's accounting terminology, Bulletin says, "Accounting is the effect of writing, classifying and summarizing the behaviors and incidents that are at least partially of the financial nature, effectively And the art of interpreting their results. (MBA TOPIC)

Source- edx.org

According to the definition, accounting is an art, not science & this art is used for the recording, classification, condensation and interpretation of scalable behavior and events in the currency of the financial nature.

Accounting is the only art of analyzing, summarizing, reporting and analyzing a business's financial transaction. The person taking charge of accounting is known as an accountant and the accountant's role is similar to a record-keeper. However, accounting is now considered to be a tool of management that provides valuable information about the future of the organization.

According to Smith and Ashburn, 'Accounting is mainly the science of recording and classification of business transactions and events of financial nature and it is the art of analyzing, analyzing and interpreting the important transactions and summaries of those transactions and events, and communicating the results to those who are to decide. From above definition, accounting is both science and art. But it is almost complete science, not a complete science.(MBA TOPIC)

Accounting Concepts

What is accounting?

Articles and notations, both are combined with 2 words in the accounting by writing the meaning of the article, and by marking means the meanings. Writing of an event sequence in the digits is called accounting.

In order to achieve a goal, the process of writing incident in the digits is called accounting. What is the meaning of the events here that all the actions in which the exchange of money is done?

Examples:

Very wise things are bought in a business, very sales are sold. The expenses also continue to occur, the amount of money spent on it, the amount of money spent, how many people have earned and how much profit or loss was made, in order to achieve all this information, the practitioner writes the events happening in the same lives . This type of writing is called accounting.

Based on the transaction, the account has been divided into three parts:

1. Personal Account: Accounts related to individuals and institutions are called personal accounts. Like Mohan's article, Shankar Vastralaya's accounting was personalized.

Rule of Personal Account:

Debit The Receiver

Credit the Giver

2. Real Account: The actual account of the account related to property and property is called. Such as the account of cash, the accounting of the cycle was real accounting.

Rule of Real Account:

Debit what comes in

Credit what goes out

3. Nominal Account:

The account related to expenditure and income is called Unreal Accounting. Such as rent accounting, account of interest was unrealistic accounting.

Rule of Nominal Account:

Debit all expenses and losses

Credit all incomes and gains

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