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    Sujoy Sengupta
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    Transactions involve economic activities that change a business's financial position and can be internal or external. Events are the end results of transactions, like profits, losses, or closing stock balances at the end of an accounting period. Accounts record individual transactions of a like nature in one place and make up the ledger to track amounts for people or items involved in business dealings. Capital is the amount invested in a business by its owner and represents assets minus liabilities, while drawings are cash or goods withdrawn by the owner for personal use that reduce the business's capital.

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    accounts terms

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    Transactions involve economic activities that change a business's financial position and can be internal or external. Events are the end results of transactions, like profits, losses, or closing stock balances at the end of an accounting period. Accounts record individual transactions of a like nature in one place and make up the ledger to track amounts for people or items involved in business dealings. Capital is the amount invested in a business by its owner and represents assets minus liabilities, while drawings are cash or goods withdrawn by the owner for personal use that reduce the business's capital.

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    6 views8 pages

    Accounts Terms

    Uploaded by

    Sujoy Sengupta
    Transactions involve economic activities that change a business's financial position and can be internal or external. Events are the end results of transactions, like profits, losses, or closing stock balances at the end of an accounting period. Accounts record individual transactions of a like nature in one place and make up the ledger to track amounts for people or items involved in business dealings. Capital is the amount invested in a business by its owner and represents assets minus liabilities, while drawings are cash or goods withdrawn by the owner for personal use that reduce the business's capital.

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    © All Rights Reserved
    Download as PPTX, PDF, TXT or read online from Scribd
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    of 8

    BASIC ACCOUNTING TERMS

    TRANSACTIONS
    • Business transaction is an Economic Activity
    which changes the Financial Poistion.
    FEATURES
    • It involves Economic Activity.
    • It results in change in Financial Position of
    Business.
    • They are Internal and External.
    EVENT
    • These are the End Results of transactions.
    • Like Profit / Loss at the end of the year.
    • Like Closing stock at the end of the year.
    • Like Purchase of Building is a Transaction as
    well as an Event.
    ACCOUNT
    • Individual Transactions of like nature are
    recorded at one place.
    • It is a LEDGER record of all business
    transactions relating to a particular person or
    item.
    CAPITAL
    • It is the amount invested by the
    Owner/Propritor in a business enterprise.
    • It can be in the form of Cash, Goods or Assets.
    • It is also called as Owner’s Equity/ Net Worth

    CAPITAL = ASSETS - LIABILITIES


    DRAWINGS
    • Cash or Value of Goods withdrawn by the
    Owner for personal use.
    • It reduces the Capital of business.
    LIABILITY

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