Basics of Accountancy
BASICS OF ACCOUNTANCY FINANCIAL ACCOUNTING In accounting. the two terms namely: Accounting and Financial Accounting are used interchangeably. But accounting is a tree while financial accounting is one of its branches. All accounting work in the beginning was in nature of financial accounting which was used to record business transactions for a certain period usually called accounting period. Then, these transactions were classified and summarized in the form of profit and loss account to calculate or found out profit or loss for the accounting period which is generally of one year. Financial accounting also helps to know the financial position of the business enterprise as on the last date of the accounting period in the form of assets possessed or owned by it and the liabilities owing to others. The statement showing the financial position is technically called the balance sheet. ACCOUNTING AS AN INFORMATION SYSTEM Accounting is often referred to as the language of ...