Management Accounting

Meaning:
Which gives accounting
information to the managers for taking
managerial decisions.

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Types of Accounting

 1. Financial Accounting
 2. Management Accounting
 3. Cost Accounting

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1. Financial Accounting

Primarily concerned with record

keeping and directed towards the
preparation of P&L account and Balance
Sheet.

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2.Management Accounting

Primarily concerned with the supply

of information which is useful to
management

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3.Cost Accounting

It is the process of accounting

towards the cost per unit or output

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Financial Accounting:

According to AICPAC “Accounting is

the art of recording, classifying and
summarizing money transaction and
events of financial characters and
interpreting result thereof”

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Principles of Accounting

Principles of accounting is set of

rules which are followed for arriving
expected result. As per the
principles, the accounting is
classified into the following types
1.Personal Account
2. Real Account
3. Nominal Account

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Personal Account

 Account deals with natural, artificial and

representative persons is called as
personal account
 Rules:
 Debit the receiver
 Credit the giver

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Real Account

 Account deals with the tangible and

intangible assets are called as real
account

 Rules:
 Debit what comes in
 Credit what goes out

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Nominal account

 Account deals with the expenditures,

loss, incomes and gains.

 Rules:
 Debit all expenses and losses
 Credit all incomes and gains

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Accounting Concepts

1.Business Entity Concepts

2.Going Concern Concepts
3.Money Measurement Concepts
4.Accounting Period Concepts

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 5.Dual Aspect Concept
 6. Cost Concept
 7.Revenue recognition or Realization
Concepts
 8. Matching Concepts
 9. Accrual Concepts
 10.Objective Evidence Concepts

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Accounting Conventions

1.Convention of Fully Disclosure

2.Convention of Consistency
3.Convention of Conservatism
4.Convention of Materiality

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