Archive | Accounting

Although for most laymen both cost and price seem to convey the same meaning, in reality these tow are different from each other.

Accounting is the analysis and interpretation of book-keeping records. It includes not only the maintenance of accounting records but also the preparation of financial and economic

When closing stock appears in adjustment it is recorded in the credit side of Trading Account and again in the asset side of Balance Sheet.

No, Trial Balance is not a complete proof of arithmetical accuracy of account. A Trial Balance in which the credit and debit accounts match does not prove that, all transactions have been recorded in the proper accounts.

A computer is an electronic device that receives data or a set of instructions, processes them and then gives the information.

The main disadvantages of a cheque system are as follows:

The important usefulness of a crossing cheque is that it cannot be encased at the counter but can be collected only by a bank from the drawee bank.

The documents for receipt side entries are (i) copy of cash memo given to customer (ii) copy of money receipt issued to debtors for payment in cash…

Documentary evidences for recording the Receipt side of Single Column Cash Book are:

The difference between Special Journal and Journal Proper are:

Trade discount is given by the wholesaler to retailer on printed price for encouraging bulk purchase of an item and to earn profit by selling the goods at printed price.

When the size of an organisation is very large and there are a number of accounts, it is not possible to keep all these accounts in a ledger.

In accounting certain steps are to be followed which are repeated year after year. These are:

The main reasons for subdividing the journal into many subsidiary books are as follows:

The advantages of accounting equation are as follows:

The whole of financial accounting (i.e. recording of transactions) is based on the accounting equation. The following is the accounting equation: