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The various conventions followed in accountancy are:

Prepaid expenses are those expenses which have been paid in advance. In other words, these are the expenses which have been paid during the accounting period for which the final

Following are the reasons of providing depreciations on fixed assets:

Except the opening balance all entries on the debit side of the cash book are posted to the credit sid of the respective account in the ledger with the words “By Cash/Bank” written in the particulars column.

Three branches of accounting are as follows:

Even though it is assumed that business will continue to exit for a long time, it is necessary to keep accounts in such a manner that the results are known at frequent intervals.

If both the total is not equal then it is decided that there is error in the books of account and efforts will be made to locate the error by following several steps as follows:

The expenses which are recorded in the debit side of Profit and Loss Account may be classified under the following heads.

When an error affects both the debit and credit by an equal amount it is called two-sided or double-sided errors. They are as follows:

Bank reconciliation Statement is a statement not an account because of the following reasons:

The following procedures are followed for recording the transactions in the ledger:

The various steps involved in the accounting process are as follows:

In order to incorporate bank transactions (receipts and payments by cheque) which are allowed by the business to its customers and cash discounts.

The various types of liabilities are given below:

Sales Day book is used to record the credit sales of goods only. It means Only credits sales of merchandise or goods meant for sale are recorded.

Subsidiary book may be defined as a book of prime entry in which transactions of a particular category are recorded. In other words, in order to save time and energy, the transactions…