Classification/Types of accounts in accounting i.e. accounts are classified into two categories personal or impersonal accounts. Impersonal accounts can be further sub-divided into real or nominal accounts. Lets understand meaning of account in brief. Accounting means system of classifying, summarizing…
Contingent liabilities means possible obligation arising from past events and may arises in future depending on occurrence and non-occurence of one or more uncertain future events. In other words contingent liabilities are potential liabilities that may or may not occur…
What is accrual concept in accounwting? Accrual concept means effects of transaction and events are recorded on mercantile basis i.e. when they occur ( not as cash or cash equivalent is received or paid). Further they are recorded in accounting…
Materiality concept in accounting guide the recognition of transactions. Materiality concept ignores the other concept if the effect is not considered material. What is materiality concept in accounting? Materiality concept in accounting is an accounting convention that guides the recognition…
Fundamental accounting assumptions is the basic assumption followed by every entity. If nothing has been written about the fundamental accounting assumption in the financial statements then it is assumed that they have been followed in their preparation of financial statements.…
What is bookkeeping and accounting? Bookkeeping: Bookkeeping is an activity which means recording of financial data relating to business operation in significant and orderly manner.It covers the procedural aspects of accounting work and embraces record keeping function. Further, bookkeeping procedures…
What is accounting and its objectives? Accounting means system of classifying, summarizing and recording of financial and business transactions. Further, it is communication of financial and non-financial information. What is Accounting? According to American Institute of Certified Public Accountants- “Accounting…