P. 1
Ppts1 Process

Ppts1 Process

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Published by: prashant_mittal_7 on Jan 04, 2011
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- Dr. Sandeep Goel


‡ Summarising ‡ ‡ Analysis and Interpretation Communication / Reporting .ACCOUNTING PROCESS ‡ ‡ ‡ Identifying the Financial Transactions Recording Classifying In the book of original entry.. and (ii) Balance Sheet.e. i. in µJournal¶ Grouping into various Accounts in a µLedger Book¶ Into Statements: (i) Trial Balance. (ii) Profit and Loss Account.

. accounting is a wider concept than book keeping. .BOOK KEEPING "Book Keeping is an art of recording in the books of accounts the monetary aspect of financial transactions." ± Northcott  Thus.i. book keeping is a part of accounting.e..

and Cost control .BRANCHES OF ACCOUNTING Financial Accounting Finding the profit / loss Determining the financial position Cost Accounting Cost ascertainment .

Double entry is followed 2. COST ACCOUNTING Financial Accounting Objective Cost Accounting Concerned with the Concerned with the overall performance of a ascertaining and controlling business as a whole the costs of products or services External in nature Internal in nature Voluntary No such method and principles Orientation Enforceability Compulsory Accounting method and principles 1. GAAP is followed .FINANCIAL ACCOUNTING VS.

PRIME BUSINESS ELEMENTS Capital Assets Liabilities Revenue Expenses .

CAPITAL Owners¶ Contribution / Shareholders¶ Funds .

Raw material .Finished Goods Debtors .Work-in-Progress .ASSETS Fixed Assets Land and Buildings Plant and Machinery Furniture and Fixtures Investments Goodwill Current Assets Cash and Bank Stock / Inventory .

LIABILITIES Long-Term Liabilities Current Liabilities Loans from Banks & Financial Institutions Loans from Public Creditors Bank Overdraft Short-term Loans .

Interest income .operating Income Financial income .REVENUE / INCOME Non.Dividend income Gain on sale of fixed assets Operating Income Sales and services .

Interest on Loan Wages Salaries Rent of office Electricity Selling &Distribution .operating Expenses Financial Expenses .EXPENSES Operating Expenses Non.

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