How sales and sales return taken in journal
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 …
Ledger Account and It’s Importance
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 …
Diminishing Balance Method | Definition, Advantages and Disadvantages
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 …
Trial Balance Concept and Definition
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 …
What is statement of expenditure
The new government accounting system requires an operating level office to regularly report on expenditures to the concerned central level office. For this purpose, a number of reports are prepared in the form of statements and submitted to the concerned central-level office. For this purpose, a number of reports are …
Bank Cash Book | Meaning, Objectives, Importance
As we know most of our readers are students. Are you a student studying accounting or finance? If so, you’ve likely heard of a Bank Cash Book but may not fully understand its meaning and objectives. In simple terms, a Bank Cash Book is a record of all cash transactions …
Petty Cash Book and It’s Concept
The new government accounting system emphasizes that government transactions have to take place only through banks. In other words, all receipts and payments have to be made only by bank cheques. since banks are ordinarily not bound to pay cheques drawn for less than Rs. 100, it is, however, not …
Subsidiary Books and It’s importance
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 …
What really is capital formation | Process of Capital Formation
Capital formation means increasing the real stock of capital of a country. It is the process of building up the capital stock of a country through investment in productive plants and equipment. Capital formation refers to the increase in the productive capacity of the economy over a period of time. …
Concept Of Government Accounting
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 …
