What is the BRANCHES OF ACCOUNTING
To meet the ever increasing demands made on accounting by differentinterested parties such as owners, management, creditors, taxation authorities etc.
the various branches have come into existence. There are as follows
Financial accounting.The object of financial accounting is to ascertain
the results (profit or loss) of business operations during the particular period and
to state the financial position (balance sheet) as on a date at the end of the period.
Cost accounting.The object of cost accounting is to find out the cost of
goods produced or services rendered by a business. It also helps the business in
controlling the costs by indicating avoidable losses and wastes.
Management accounting.Management accounting. The object of management accounting is to supply
relevant information at appropriate time to the management to enable it to take
decisions and effect control.
In this lesson we are concerned only with financial accounting.
Financial accounting is the oldest and other branches have developed from it. The
objects of financial accounting, as stated above, can be achieved only by recording
the financial transactions in a systematic manner according to a set of principles.
The art of recording financial transactions and events in a systematic manner in
the books of account is known as book-keeping. However, mere record of
transactions is not enough. The recorded information has to be classified, analysed
and presented in a manner in which business results and financial position can be
ascertained.
To meet the ever increasing demands made on accounting by differentinterested parties such as owners, management, creditors, taxation authorities etc.
the various branches have come into existence. There are as follows
Financial accounting.The object of financial accounting is to ascertain
the results (profit or loss) of business operations during the particular period and
to state the financial position (balance sheet) as on a date at the end of the period.
Cost accounting.The object of cost accounting is to find out the cost of
goods produced or services rendered by a business. It also helps the business in
controlling the costs by indicating avoidable losses and wastes.
Management accounting.Management accounting. The object of management accounting is to supply
relevant information at appropriate time to the management to enable it to take
decisions and effect control.
In this lesson we are concerned only with financial accounting.
Financial accounting is the oldest and other branches have developed from it. The
objects of financial accounting, as stated above, can be achieved only by recording
the financial transactions in a systematic manner according to a set of principles.
The art of recording financial transactions and events in a systematic manner in
the books of account is known as book-keeping. However, mere record of
transactions is not enough. The recorded information has to be classified, analysed
and presented in a manner in which business results and financial position can be
ascertained.
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