Account

The income and expenditure account is prepared by a nontrading concern to reveal the surplus or deficit arising out of the operating activities during the accounting period. It is one of the final accounts of nontrading concern like the profit and loss account of trading concern. All the revenue incomes during the accounting period are … Read more

Receipts and payment account are a summary of cash receipts and payments received during the accounting period. It records all cash receipts and payments including capital receipts and revenue receipts respective of the accounting period. All cash (cash and bank) receipts are recorded on the debit (receipts) side and all cash (cash and bank ) payments are recorded on the … Read more

 When goods are sold in a cash, the sales account is credited. Cash belongs to real accounts and according to the rule of real account assets coming into business debited. On the other hand, in the case of cash sales, income from sales is credited. Similarly, when goods are sold for cash, assets increase in … Read more

LEDGER ACCOUNT To help reveal the financial position: The ledger also contains the accounts of the financial transactions relating to capital, all liabilities, and assets of the business. With the help of the balances of these accounts and the profit or loss of the business, a balance sheet may be prepared to show its financial … Read more

Under the reducing balancing method, depreciation is charged at a fixed rate on the reducing balance of assets after deducting depreciation every year. The reducing method is also popularly known as Diminishing Balance Method. The balance in the asset account will go on decreasing but will never become zero. The remaining balance in the asset … Read more

Trial balance is an important statement prepared under the double-entry system. The fundamental principle of the double-entry system is that for every amount of debt, there is an equal amount of credit or vice versa.  This principle provides a check on the arithmetical accuracy of the recordings of financial transactions in different books such as … Read more

CONCEPT OF SUBSIDIARY BOOKS A big business needs to perform a large volume of financial transactions As a result, the title of a single journal book may be inadequate as well as inconvenient to systematically record all such financial transactions. Thus, the journal is subdivided into a number of specialized journals known as the subdivision … Read more

 Accounting is concerned with the processing of financial information of an entity. It generates and communicates the necessary financial information to its users. It is, therefore, a process of recording classifying, and summarizing the financial transactions, and communicating the results of its operations. Definition of Government Accounting Government accounting is the process of recording , … 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