Accounting, accounting and financial accounting

May 23, 2018 | By admin4u | Filed in: Uncategorized.

Accounting and Bookkeeping Bookkeeping involves transactions (correctly and in a series of books) that transfer money or money. While accounting from a perspective is comprehensive.

Accounting and Accounting

Accounting and Accounting (19659002) The regulation of the classification of knowledge in classification and analysis (principles, postulates, assumptions, conventions, concepts and rules) forms part of financial transactions in accounting. While the practice and art of accounting science are called bookkeepers. Various branches have been established to meet the growing demands of different stakeholders (eg Owners, Leadership, Creditors, Tax Administrations, etc.). Financial Accounting The purpose of financial accounting is to determine the profits or losses of a business during a given period and the statement of financial position at the end of the period

Cost Accounting [19659002] The purpose of cost accounting is to acquaint the business the cost of products or services produced by businesses. It helps the business to control costs by indicating avoidable losses and wastes. Management Accounting The purpose of management accounting is to provide the management with adequate information at the right time to allow for control of decisions and impacts. In this web foundation we are only dealing with financial accounts. The scope of the financial accounting described above can only be achieved by systematically accounting for financial transactions. Classified information should be graded, analyzed and presented in such a way that business results and financial status can be determined.

Accounting Uses

Accounting is an important and useful part of developing information to answer many questions from users of accounting information

(1) How bad or bad is the financial position of a business

2) Whether or not a business has resulted in a gain or loss [19659002] (5) Which of the existing products should be discontinued and terminated (19659002) (6) Do you need to buy an ingredient from the market or manufacture it ?

(7) Are production costs reasonable or exaggerated (19659002) (8) What was the Existing Impact (19659002) (9) What are the likely results of new policy decisions on future earning power in business policy?

(10) Given the past performance of a business, how is a future plan to achieve the desired results?

The above-mentioned examples provide few examples of users of accounting information.

In addition, accounting is useful for the following reasons: –

(1) Increasing the number of businesses results in a large number of transactions, and not a business man is remembering everything.

(2) The accounting records drawn up on the basis of the standard practices enable businesses to compare the results of one period to another period.

(3) Tax authorities (both income tax and sales tax) are likely to believe the facts contained in the accounting records if they are maintained in accordance with generally accepted accounting principles. [4] Acknowledged by the appropriate and verified vouchers [19659002] (5) When an enterprise is sold as a business activity, the assets of the various assets presented in the balance sheet will help the business at the right price.

Financial Accounting

The accounting benefits discussed in this section do not indicate that accounting is non-limiting

The following restrictions:

Financial Accounting allows alternative treatments Accounting is based on concepts and is based on "generally accepted principles" but contains more than one principle for dealing with a batch. This allows alternative treatments based on generally accepted principles. For example, one of the following methods can be used to evaluate an enterprise's closing stock: FIFO (First-in First-Out), LIFO (Last-in-First-out), Average Price, Standard Price, etc. But the results can not be compared

financial accounting does not provide timely information

No limitation is to use a high performance software application such as HiTech Financial Accenting, online and simultaneous accounts, where the balance is almost immediately available. However, this handicap has a handicap.

Financial Accounting aims to provide information in the form of statements (balance sheet and income statement) for a one-year period. So the information is at best historical, and only the post-mortem analysis is possible. Business often requires timely information, allowing management to plan and take corrective action. For example, if a business estimated that a sale should be $ 12,00,000 during the current year, it requires that sales in the first month of the year be 10,00,000 or less or more

financial accounting does not provide information for less than a year at a shorter interval. With the introduction of computer accounting, HiTech Financial Accounting, like HiTech Financial Accounting, displays the monthly income statement and balance sheet to overcome this limit. Financial accounting is influenced by personal judgments that respect the "objectivity convention" in accounting, but estimations of certain events need to be made, which require personal judgment. It is very difficult to wait for future estimates and objectivity. For example, estimating the amount of depreciation annually requires estimation of the use of fixed assets and the revenue disclosed by the accounting report can not be regarded as credible, but "approximation".

Financial Accounting ignores important non-monetary information

Financial accounting does not consider non-monetary transactions. For example, the degree of competition in business, innovation in business, employee loyalty and efficiency; changes in the value of money, etc. the important things in which business management is interested in, but accounting is not designed to take such matters into account. Thus any user of financial information will deprive the non-monetary vital information of course. In modern times, proper accounting software for MIS and CRM can be most useful in overcoming this limitation.

Financial Accounting does not provide a detailed analysis

Financial information is actually a summary of financial transactions during the year. Of course, it allows you to study the company's overall results in requiring information on the cost, revenue and profit of each product, but financial accounting does not provide such detailed information as a product. For example, if the business has achieved a full business result, it accounts for $ 5,00,000 during the accounting year and sells three products, namely gasoline. diesel and mobile oil and want to know the gains of each product. Financial accounting is unlikely to help you unless you use a computerized accounting system that can handle such complex queries. Numerous reports in computer accounting software such as HiTech Financial Accounting, which was explained by graphs and unique reports according to the needs of the business.

Financial Accounting has not given the current value of business

the position of the business as it is known as a "balance" at a given time. The assets in the balance sheet are presented on the basis of the "Continuing Entity Concept", so it is assumed that business life has a relatively longer life span and will continue to exist indefinitely, so asset values ​​are "ongoing values". The "realized value" of each asset, if sold today, can not be recognized in the balance sheet

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Source by Anil Kumar Gupta


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