Reserve and It’s Concept

A business has to face several known and unknown contingencies and losses. There may be, for example, a decline in profits or occurring of losses, needs for replacing assets, rise and fall in the value of assets, fluctuations in price and exchange rates, and change in fashion and technology.  These contingencies may adversely affect the … Read more

Single Entry System and It’s Meaning

Concept Of Single Entry System There are different forms of business concerns. Some of these concerns are small traditionally run and legally not required to maintain their books of accounts under a particular accounting system. Generally, a small sole trading concern run by the not well-educated owner having no idea of a modern accounting system … Read more

Non-Trading Concerns and It’s accounts

Concept of Non-Trading Concerns There are many concerns that have the main motto of rendering services instead of making profits. Such concerns are call non-trading of non-profit-making concerns. Examples of such concerns include different types of clubs, schools, colleges, hospitals, libraries, Guthies, professional associations, and unions.  These concerns render services to their members and to … Read more

Provision and It’s Objectives

A provision is the sum of the amount set aside by charging against the profit and loss account. It is created for meeting a known loss or liability. It is maintained for meeting an anticipated loss or liability of an uncertain amount. Such an amount of anticipated loss or liability of uncertain amount. Such an … Read more

Depreciation and It’s concept

Meaning  of depreciation Every business wons and uses fixed assets such as land, building, machinery, tools, equipment, vehicles, furniture, patents, patterns, designs, etc. for the purpose of generating revenue through its production and selling operations. These assets have relatively long lives such as 5, 10, 20 years or so. and are not meant for resale. All … Read more