Which number is missing

on the bottom credit card?

Answer: 8

The number formed by the

two first digits is always
doubled. 12, 24, 48, 96, 192 on
the top card and 23, 46, 92,
184, 368 on the bottom card.
 Sangat National High School
Senior High Department

Fundamentals of ABM 1
(Accountancy, Business, and Management)

Content 1: Introduction to Accounting

Prepared by: NERISSA MENDAROS-AUXILIO, MBA

 Learning Competencies
The learners….
➢ define accounting (ABM_FABM11-111a-1)
➢ describe the nature of accounting (ABM_FABM11-111a-2)
➢ explain the functions of accounting in business (ABM_FABM11-
111a-3)
➢ narrate the history/origin of accounting (ABM_FABM11-111a-4)
 ORIGIN OF
ACCOUNTING
The Renaissance
The Vatican, and the Italian banking centers of Genoa,
Florence and Venice grew wealthy in the 14th century.
Their operations recorded transactions, made loans, issued
receipts and other modern banking activities.
Fibbonaci’s Liber Abbas was widely read in Italy, and the
Italian Giovanni di Bicci de’ Medici introduced double-entry
bookkeeping for the Medici bank in the 14th century.

By the end of the 15th century, merchant ventures in Venice

used this system widely. The Vatican was an early customer
for German printing technology, which they used to churn
out indulgences.
Printing reached a wider audience with widely available
reading glasses from Venetian glassmakers (medieval
Europeans tended to be far-sighted, which made reading
difficult before spectacles).
Italy became a center for European printing, particularly
with the rise of Aldine Press editions of classics in Greek and
Latin.
 It was in this environment that a close friend of Leonardo da
Vinci, the itinerant tutor, Luca Pacioli published a book not in
Greek or Latin, but in a language that merchants understood
well -- Italian vernacular.
Pacioli received an abbaco education, i.e., education in the
vernacular rather than Latin and focused on the knowledge
required of merchants.
His pragmatic orientation, widespread promotion by his friend
da Vinci, and use of vernacular Italian assured that his 1494
publication, Summa de Arithmetica, Geometria, Proportioni et
Proportionalita (Everything About Arithmetic, Geometry and
Proportion) would become wildly popular.
Pacioli's book explained the Hindu-Arabic numerals, new
developments in mathematics, and the system of double-entry
was popular with the increasingly influential merchant class.
In contrast to scholarly abstracts in Latin, Pacioli's vernacular text
was accessible to the common man, and addressed the needs of
businessmen and merchants.
His book remained in print for nearly 400 years.
Luca’s book popularized the words “credre” means “to
entrust” and “debere” means “to owe”-the origin of
the use of the words "debit" and "credit" in
accounting, but goes back to the days of single-entry
bookkeeping, which had as its chief objective keeping
track of amounts owed by customers (debtors) and
amounts owed to creditors.
Debit in Latin means "he owes" and credit in Latin
means "he trusts".

Ragusan economist Benedetto Cotrugli's 1458 treatise

Della mercatura e del mercante perfetto contained
the earliest known manuscript of a double-entry
bookkeeping system.
His manuscript was first published in 1573.
 Luca Pacioli's Summa de Arithmetica, Geometria, Proportioni
et Proportionalità (early Italian: "Review of Arithmetic,
Geometry, Ratio and Proportion") was first printed and
published in Venice in 1494.
It included a 27-page treatise on bookkeeping, "Particularis de
Computis et Scripturis" (Latin: "Details of Calculation and
Recording").
Pacioli wrote primarily for, and sold mainly to, merchants who
used the book as a reference text, as a source of pleasure
from the mathematical puzzles it contained, and to aid the
education of their sons.
His work represents the first known printed treatise on
bookkeeping; and it is widely believed to be the forerunner of
modern bookkeeping practice.
In Summa de arithmetica, Pacioli introduced symbols for plus
and minus for the first time in a printed book, symbols which
became standard notation in Italian Renaissance
mathematics. Summa de arithmetica was also the first known
book printed in Italy to contain algebra.
 Ragusan economist Benedetto Cotrugli's 1458
treatise Della mercatura e del mercante perfetto
contained the earliest known manuscript of a double-
entry bookkeeping system,
however Cotrugli's manuscript was not officially
published until 1573.

In fact even at the time of writing his work in 1494

Pacioli was aware of Cotrugli's efforts and credited
Cortrugli with the origination of the double entry
book keeping system.
Although Luca Pacioli did not invent double-entry
bookkeeping, his 27-page treatise on bookkeeping is
an important work because of its wide circulation
and the fact that it was printed in
the vernacular Italian language.
 Pacioli saw accounting as an ad-hoc ordering
system devised by the merchant. Its regular use
provides the merchant with continued
information about his business, and allows him
to evaluate how things are going and to act
accordingly.
Pacioli recommends the Venetian method of
double-entry bookkeeping above all others.

Three major books of account are at the direct

basis of this system:
1. the memoriale (Italian: memorandum)
2. the giornale (Journal)
3. the quaderno (ledger)

The ledger classes as the central document and

is accompanied by an alphabetical index.
 Pacioli's treatise gave instructions on recording barter transactions and
transactions in a variety of currencies – both of which were far more
common than today.
It also enabled merchants to audit their own books and to ensure that the
entries in the accounting records made by their bookkeepers complied with
the method he described.
Without such a system, all merchants who did not maintain their own
records were at greater risk of theft by their employees and agents:
it is not by accident that the first and last items described in his treatise
concern maintenance of an accurate inventory.