UNIT-1

Evolution or History of Accounting:

 Founder of Accounting- Chanakya
- In Maurya Empire period i.e. between 350-
275 BCE he founded accounting.
- He founded a system of accounting called
as Desi Nama System.
 Father of Accounting- Luca Pacioli (1447-1517)
- He was an Italian mathematician.
- In the year 1494 he founded Double Entry
System of accounting .
Dr. Mayank Malviya
Meaning of Accounting
 It is an art of recording, classifying and summarizing the
transactions in a significant manner and in terms of money,
transactions and event, which are, in part at least, of a financial
character and interpreting the results thereof.

Dr. Mayank Malviya

Definitions of Accounting
 According to American Institute of Certified Public
Accountants (AICPA), “Accounting is an art of recording,
classifying and summarising in significant manner and in
terms of money, transactions and events which are, in part, at
least of a financial character and interpreting the results
thereof”.
 According to American Accounting Association (AAA),
“Accounting is the process of identifying, measuring and
communicating economic information to permit informed
judgment and decision by users of the information”.
 According to American Standards Council (ASC), “It is a
service activity. It’s function is to provide quantitative
information, primarily financial in nature, that is intended to be
useful in making economic decisions”.

Dr. Mayank Malviya

Basic Terminology of Accounting
1. Debit
2. Credit
3. Purchase
4. Sales
5. Capital (Owner’s Equity)
6. Assets
7. Liabilities
8. Drawings
9. Bank
10. Bad debts
11. Discount
12. Debtors
13. Creditors
14. Bills Receivable (B/R)
15. Bills Payable (B/P)
16. Accounts Receivable
17. Accounts Payable
18. Outstanding Expenses
19. Prepaid Expenses
20. Accrued Income
21. Prepaid Income

Dr. Mayank Malviya