Got a tricky question? Receive an answer from students like you! Try us!

Definition of accounting - Essay Example

Only on StudentShare
Masters
Author : miles31
Essay
Business
Pages 2 (502 words)

Summary

All recorded transactions, which are of the same type and nature, are grouped under one head. Cash sales, credit sales and sales to owner, etc., are grouped as total sales. Cash purchases, credit purchases etc., are classified as total purchases…

Extract of sample
Definition of accounting

Business profits and financial position. These are known as financial statements or profit and loss account and Balance sheet.With the help of analysis, useful information is obtained form financial statements. The users of the information then interpret the information derived. Such interpretation helps interested parties in taking prompt decisions. The whole process of recording, classifying, summarizing and interpreting is known as accounting. The art of recording, classifying, summarizing, analysing and interpreting the business transactions systematically and communicating business results to the interested users. These interested users may be owner himself of herself, creditors government, etc.; accounting is also viewed as discipline. It has its own principles, rules and concepts, which guide accountants in their accounting practices.The meaning of the word consistency is continuity in methods or practices. In accounting context, consistency means followers using the same accounting methods or practice year after year. You can also say that the methods followed for making accounting information is not altered generally during its life. A businessman fro example, follows the following practices or methods generally year after year:Machines and other fixed assets used in a business slowly decline in value over time. ...
Download paper

Related Essays

The Definition of an Operating Segment
Corporations that sell at the retail level, but who also have an online operation have multiple operating segments. The e-commerce operation would be considered an operating segment. Let’s take the Jiffy Lube business as an example. The money generated by the oil change operation would be considered an operating segment. The car wash operation of the business is another operating segment. Any food items sold inside the store in the waiting area would be a third operating segment of the company. …
3 pages (753 words)
The Generally Accepted Accounting Principles in the UK
The chief standard-setter is the Accounting Standards Board (ASB), which issues standards called Financial Reporting Standards (FRSs). The ASB is part of the Financial Reporting Council, an independent regulator funded by a levy on listed companies[1], and it replaced the Accounting Standards Committee (ASC), which was disbanded in 1990 following a number of criticisms of its work. To the extent that the ASC's pronouncements, known as Statements of Standard Accounting Practice (SSAPs), have not been replaced by FRSs, they remain in force. The ASB has a formal exposure process for proposed…
10 pages (2510 words)
Management Accounting
Management accounting also comprises the preparation of financial reports for non-management groups such as shareholders, creditors, regulatory agencies, and tax authorities." (Riahi-Belkaoui, 1992)…
8 pages (2008 words)
Historic cost accounting
Unemployment in the UK has fallen to a twenty five year low and yet inflation has remained low. This shows that there has been an improvement in the trade-off between inflation and unemployment. The non accelerating inflation rate of unemployment (or NAIRU) has declined because of increased flexibility in the labour market and a reduction in structural unemployment. (Has the UK supply side improved')…
4 pages (1004 words)
Financial accounting Master Essay
In order to look at how accounting theories impact practicing accountants today, this paper will give an extensive discussion of how the history of accounting thought evolved in order to form a conceptual framework that is currently utilized in the business world. Throughout history, the need of a single and unified conceptual framework which will embody the needs of business organization for financial reporting has been a pressing concern. The lack of established accounting theory to support the reporting of financial transactions and production of financial reports called for the foundation…
12 pages (3012 words)