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Sub-fields of Accounting

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Sub-fields of Accounting 
 
(1) Financial Accounting 
                  Financial accounting covers the preparation and interpretation  of financial statement and communication to the users of accounts.The final step of financial accounting is the preparation of profit and loss Account and the Balance Sheet. 
 
(2) Management Accounting 
                It is concerned with internal reporting to the managers of a business unit.To discharge the function of stewardship,planning,control and decision making,the management needs variety of information.The different ways of grouping information and preparing report as desired by managers for discharging their functions are referred to as management accounting which deals with cost ascertainment and cost control. 
 
(3) Cost Accounting 
               "the process of accounting for cost which begins with the recording of income and expenditure or the bases on which they are calculated and ends with the preparation of periodical statements and reports for ascertaining and controlling costs" 
 
(4) Social Responsibility Accounting 
                 Social  responsibility accounting is concerned with accounting for social costs incurred by the enterprise and social benefits created. 
 
(5) Human Resource Accounting 
                 Human resource accounting is an attempt to identity,quantify and report investment made in human resources of an organisation that are not presently accounted for under conventional accounting practice. 
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Sub-fields of Accounting

Sub-fields of Accounting (1) Financial Accounting Financial accounting covers the preparation and interpretation of f...

Accounting concept

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Accounting
 Concepts and Principles are a set of broad conventions that have been 
devised to provide a basic framework for financial reporting. As 
financial reporting involves significant professional judgments by 
accountants, these concepts and principles ensure that the users of 
financial information are not mislead by the adoption of accounting 
policies and practices that go against the spirit of the accountancy 
profession.
Accountants must therefore actively consider whether the accounting 
treatments adopted are consistent with the accounting concepts and 
principles.
 - See more at: 
http://accounting-simplified.com/financial-accounting/accounting-concepts-and-principles/#sthash.2iFuxnrM.dpuf</div>
<div id="stcpDiv" style="left: -1988px; position: absolute; top: -1999px;">
Accounting
 Concepts and Principles are a set of broad conventions that have been 
devised to provide a basic framework for financial reporting. As 
financial reporting involves significant professional judgments by 
accountants, these concepts and principles ensure that the users of 
financial information are not mislead by the adoption of accounting 
policies and practices that go against the spirit of the accountancy 
profession.
Accountants must therefore actively consider whether the accounting 
treatments adopted are consistent with the accounting concepts and 
principles.
 - See more at: 
http://accounting-simplified.com/financial-accounting/accounting-concepts-and-principles/#sthash.2iFuxnrM.dpuf</div>
<div id="stcpDiv" style="left: -1988px; position: absolute; top: -1999px;">
Accounting
 Concepts and Principles are a set of broad conventions that have been 
devised to provide a basic framework for financial reporting. As 
financial reporting involves significant professional judgments by 
accountants, these concepts and principles ensure that the users of 
financial information are not mislead by the adoption of accounting 
policies and practices that go against the spirit of the accountancy 
profession.
Accountants must therefore actively consider whether the accounting 
treatments adopted are consistent with the accounting concepts and 
principles.
 - See more at: 
http://accounting-simplified.com/financial-accounting/accounting-concepts-and-principles/#sthash.2iFuxnrM.dpuf</div>
<div id="stcpDiv" style="left: -1988px; position: absolute; top: -1999px;">
Accounting
 Concepts and Principles are a set of broad conventions that have been 
devised to provide a basic framework for financial reporting. As 
financial reporting involves significant professional judgments by 
accountants, these concepts and principles ensure that the users of 
financial information are not mislead by the adoption of accounting 
policies and practices that go against the spirit of the accountancy 
profession.
Accountants must therefore actively consider whether the accounting 
treatments adopted are consistent with the accounting concepts and 
principles.
 - See more at: 
http://accounting-simplified.com/financial-accounting/accounting-concepts-and-principles/#sthash.2iFuxnrM.dpuf</div>
<div id="stcpDiv" style="left: -1988px; position: absolute; top: -1999px;">
Accounting
 Concepts and Principles are a set of broad conventions that have been 
devised to provide a basic framework for financial reporting. As 
financial reporting involves significant professional judgments by 
accountants, these concepts and principles ensure that the users of 
financial information are not mislead by the adoption of accounting 
policies and practices that go against the spirit of the accountancy 
profession.
Accountants must therefore actively consider whether the accounting 
treatments adopted are consistent with the accounting concepts and 
principles.
 - See more at: 
http://accounting-simplified.com/financial-accounting/accounting-concepts-and-principles/#sthash.2iFuxnrM.dpuf</div>
<div id="stcpDiv" style="left: -1988px; position: absolute; top: -1999px;">
Accounting
 Concepts and Principles are a set of broad conventions that have been 
devised to provide a basic framework for financial reporting. As 
financial reporting involves significant professional judgments by 
accountants, these concepts and principles ensure that the users of 
financial information are not mislead by the adoption of accounting 
policies and practices that go against the spirit of the accountancy 
profession.
Accountants must therefore actively consider whether the accounting 
treatments adopted are consistent with the accounting concepts and 
principles.
 - See more at: 
http://accounting-simplified.com/financial-accounting/accounting-concepts-and-principles/#sthash.2iFuxnrM.dpuf</div>
<div id="stcpDiv" style="left: -1988px; position: absolute; top: -1999px;">
Accounting
 Concepts and Principles are a set of broad conventions that have been 
devised to provide a basic framework for financial reporting. As 
financial reporting involves significant professional judgments by 
accountants, these concepts and principles ensure that the users of 
financial information are not mislead by the adoption of accounting 
policies and practices that go against the spirit of the accountancy 
profession.
Accountants must therefore actively consider whether the accounting 
treatments adopted are consistent with the accounting concepts and 
principles.
 - See more at: 
http://accounting-simplified.com/financial-accounting/accounting-concepts-and-principles/#sthash.2iFuxnrM.dpuf</div>
<div id="stcpDiv" style="left: -1988px; position: absolute; top: -1999px;">
Accounting
 Concepts and Principles are a set of broad conventions that have been 
devised to provide a basic framework for financial reporting. As 
financial reporting involves significant professional judgments by 
accountants, these concepts and principles ensure that the users of 
financial information are not mislead by the adoption of accounting 
policies and practices that go against the spirit of the accountancy 
profession.
Accountants must therefore actively consider whether the accounting 
treatments adopted are consistent with the accounting concepts and 
principles.
 - See more at: 
http://accounting-simplified.com/financial-accounting/accounting-concepts-and-principles/#sthash.2iFuxnrM.dpuf</div>
 
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 There are certain rules that  an accountant should follow while recording business transactions and preparing accounts. These may be termed as accounting concept. Thus, this can be said that : Accounting concept refers to the basic assumptions and rules and principles which work as the basis of recording of business transactions and preparing accounts. 
 
 
(1) Accruals concept: revenue and expenses are recorded when they occur and not when the cash is received or paid out; 
 
(2) Consistency concept: once an accounting method has been chosen, that method should be used unless there is a sound reason to do otherwise; 
 
(3) Going concern: the business entity for which accounts are being prepared is in good condition and will continue to be in business in the foreseeable future; 
 
(4) Prudence concept (also conservation concept): revenue and profits are included in the balance sheet only when they are realized (or there is reasonable 'certainty' of realizing them) but liabilities are included when there is reasonable 'possibility' of incurring them. 
Other concepts include 
 
(5) Accounting equation: total assets equal total liabilities plus owners' equity; 
 
(6) Accounting period: financial records pertaining only to a specific period are to be considered in preparing accounts for that period; 
 
(7) Cost basis: asset value recorded in the account books should be the actual cost paid, and not the asset's current market value; 
 
(8) Entity: accounting records reflect the financial activities of a specific business or organization, not of its owners or employees; 
 
(9) Full disclosure: financial statements and their notes should contain all relevant data; 
 
(10) Lower of cost or market value: inventory is valued either at cost or the market value (whichever is lower); 
 
(11) Maintenance of capital: profit can be realized only after capital of the firm has been restored to its original level, or is maintained at a predetermined level; 
 
(12) Matching: transactions affecting both revenues and expenses should be recognized in the same accounting period; 
 
(13) Materiality: minor events may be ignored, but the major ones should be fully disclosed; 
 
(14) Money measurement: the accounting process records only activities that can be expressed in monetary terms (with some exceptions); 
 
(15) Objectivity: financial statements should be based only on verifiable evidence, including an audit trail; 
 
(16) Realization: any change
 in the market value of an asset or liability is not recognized as a 
profit or loss until the asset is sold or the liability is paid off; 
 
(17) Unit of measurement: financial data should be recorded with a common unit of measure (dollar, pound sterling, yen, etc.). 
Also called accounting conventions, accounting postulates, or accounting principles.</div>
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Accounting concept

Accounting Concepts and Principles are a set of broad conventions that have been devised to provide a basic framework for financial rep...

Difference Between Bookkeeping and Accounting

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<h1>
Difference Between Bookkeeping and Accounting:</h1>
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<h1>
 </h1>
<h1>
The terms "bookkeeping" and "accounting" do not have the same meaning. 
Accounting is much wider than bookkeeping. The difference between bookkeeping 
and accounting arises due to the following reasons:</h1>
<table cellspacing="1" id="table7" style="height: 732px; width: 653px;"><tbody>
<tr><td style="background-color: #fdfdfd; border: 1px solid rgb(245, 245, 245); padding: 1px 4px;" valign="top" width="155">Points of difference</td>
		<td style="background-color: #fdfdfd; border: 1px solid rgb(245, 245, 245); padding: 1px 4px;" valign="top" width="179">Bookkeeping</td>
		<td style="background-color: #fdfdfd; border: 1px solid rgb(245, 245, 245); padding: 1px 4px;" valign="top">Accounting</td>
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		1. Area of work</td>
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		Bookkeeping involves the recording of business transactions in a 
		prescribed manner</td>
		<td style="border: 1px solid rgb(245, 245, 245); padding: 1px 4px;" valign="top">
		Accounting in addition to recording of business transactions, also 
		includes other matter such as making adjustments, preparation of income 
		statement, balance sheet and interpreting results thereof.</td>
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		2. Knowledge and skill</td>
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		No professional knowledge and skill is required for a bookkeeper.</td>
		<td style="border: 1px solid rgb(245, 245, 245); padding: 1px 4px;" valign="top">
		Professional knowledge and skill is prerequisite for an accountant.</td>
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		3. Scope</td>
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		Bookkeeping is an initial stage of accounting therefore, the scope of 
		bookkeeping is limited. It provides the primary information about the 
		business.</td>
		<td style="border: 1px solid rgb(245, 245, 245); padding: 1px 4px;" valign="top">
		The scope of accounting is wider.</td>
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		<td style="border: 1px solid rgb(245, 245, 245); padding: 1px 4px;" valign="top" width="155">
		4. Nature of job</td>
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		Much of the work of a bookkeeper is clerical in nature and the job is is 
		mainly preliminary.</td>
		<td style="border: 1px solid rgb(245, 245, 245); padding: 1px 4px;" valign="top">
		The work of accountant is technical in nature. Modern accounting serves 
		as eyes and ears to the management. It has become the foundation on 
		which the whole structure of commerce rests and without which no 
		business can be run at all.</td>
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		5. Information</td>
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		It provides the primary information to the business.</td>
		<td style="border: 1px solid rgb(245, 245, 245); padding: 1px 4px;" valign="top">
		It provides information about the final results of the business</td>
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		<td style="border: 1px solid rgb(245, 245, 245); padding: 1px 4px;" valign="top" width="155">
		6. Financial decisions</td>
		<td style="border: 1px solid rgb(245, 245, 245); padding: 1px 4px;" valign="top" width="179">
		Financial statements are not prepared from bookkeeping records.</td>
		<td style="border: 1px solid rgb(245, 245, 245); padding: 1px 4px;" valign="top">
		Financial statements are prepared from accounting records.</td>
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		7. Business conditions</td>
		<td style="border: 1px solid rgb(245, 245, 245); padding: 1px 4px;" valign="top" width="179">
		It does not give the complete picture of the financial condition of the 
		business unit.</td>
		<td style="border: 1px solid rgb(245, 245, 245); padding: 1px 4px;" valign="top">
		It gives the complete picture of financial condition of the business 
		unit.</td>
	</tr>
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		<td style="border: 1px solid rgb(245, 245, 245); padding: 1px 4px;" valign="top" width="155"> </td>
		<td style="border: 1px solid rgb(245, 245, 245); padding: 1px 4px;" valign="top" width="179"> </td>
		<td style="border: 1px solid rgb(245, 245, 245); padding: 1px 4px;" valign="top"> </td></tr>
</tbody></table>
<h1>
 
In spite of above mentioned points of difference between bookkeeping and 
accounting, bookkeeping is a part of accounting</h1>
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Difference Between Bookkeeping and Accounting

Difference Between Bookkeeping and Accounting: The terms "bookkeeping" and "accounting" do not have the same m...

Double-entry bookkeeping

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<h2>
Double-entry bookkeeping</h2>
<h2>
</h2>
 
<h2>
The double entry system of bookkeeping is based upon the
fact that every transaction has two parts and that this will therefore affect
two ledger accounts. 
 
Every transaction involves a debit entry in one account and a credit entry in
another account. This serves as a kind of error-detection system: if, at any
point, the sum of debits does not equal the corresponding sum of credits, then
an error has occurred.</h2>
<h2>
</h2>
<h2>

<h2>
Double-Entry, Debits and
Credits</h2>
  </h2>
<h2>

Except for some very small
companies, the standard method for recording transactions is double-entry.
Double-entry bookkeeping or double-entry accounting means that every
transaction will involve at least two accounts. To illustrate, here are a few
transactions and the two accounts that  
 
</h2>

NOTE: Double-entry bookkeeping means that
every transaction will involve a minimum
of two accounts.

<h3>

Debits and Credits</h3>

The words debit and credit have been
associated with double-entry bookkeeping and accounting for more than 500
years. Here are the meanings of those words:

debit: an entry on the left side of
an account

credit: an entry on the right side of
an account

The debit and credit rule in
double-entry bookkeeping can be stated several ways:

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·<span style="-moz-font-feature-settings: normal; -moz-font-language-override: normal; font-size-adjust: none; font-stretch: normal; font-style: normal; font-variant: normal; font-weight: normal; line-height: normal;">        
For
each and every transaction, the total amount entered on the left side of an
account (or accounts) must be equal to the total amount entered on the right
side of another account (or accounts).</div>

<div style="margin-left: 0.5in; text-indent: -0.25in;">
·<span style="-moz-font-feature-settings: normal; -moz-font-language-override: normal; font-size-adjust: none; font-stretch: normal; font-style: normal; font-variant: normal; font-weight: normal; line-height: normal;">        
For
each and every transaction, the total of the debit amounts must be equal to the
total of the credit amounts.</div>

<div style="margin-left: 0.5in; text-indent: -0.25in;">
·<span style="-moz-font-feature-settings: normal; -moz-font-language-override: normal; font-size-adjust: none; font-stretch: normal; font-style: normal; font-variant: normal; font-weight: normal; line-height: normal;">        
Debits
must equal credits.</div>

<div class="MsoNormal">
debit
amounts =credit amounts</div>

<h2>

</h2>
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Double-entry bookkeeping

Double-entry bookkeeping The double entry system of bookkeeping is based upon the fact that every transaction has two parts an...

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Sub-fields of Accounting

Accounting concept

Difference Between Bookkeeping and Accounting

Double-entry bookkeeping