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
MEANING AND DEFINITIONS OF ACCOUNTING The meaning of accounting is broader than that of bookkeeping. Accounting includes not only book-keeping but also other activities. In records classifies and summarizes the financial transactions of a business with a view to ascertaining its profit or loss for the period and its financial position at the end of … Read more
CONCEPT OF CASH TRANSACTIONS All financial transactions are ultimately settled in cash Some transactions are settled Imminently after purchase and sale and the rest are altered lew days In fact. business transactions are settled sooner or later either in cash or through the bank. Usually, sell sums are settled in cash, and Lie mums are … Read more
MEANING AND DEFINITIONS OF BOOK-KEEPING Book-keeping is the act of keeping written records of the financial transactions of a business. An owner or an accountant cannot keep in memory all the financial transactions that take place in the business for the whole year. Therefore, all such transactions have to be recorded in some books for … Read more
The new accounting system follows the principle of double-entry. Under a double-entry system, every financial transaction of the government office has a double effect. It means each transaction involves at least two accounts. One aspect of the transition is debited and another aspect is credited. Accounts are debited and credited by the following certain rules. … Read more
One of the important objectives of the new government accounting is to help control the budget and keep expenditures within the budgetary limit. For this purpose, a statement called the budget sheet is prepared. This budget sheet prescribed by the Office of the Auditor’s General, and therefore, it is coded A.G.F No.8. The budget sheet … Read more
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
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
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
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