Introduction To Basic Accounting Concepts

2010-02-09T16:09:00.000-08:00

Hello
As this is my first blog relating to accounting terms and techniques i would try my best and give the most precise point of view and explanation on accounting theories. Starting with the basics the first question that comes to the mind about accounting is firstly

What exactly is Accounting?
When and how it became a method of learning?
What are its use?
How can we benefit from it?

All these answers are pretty basic and are essential for ones understanding for the subject.
Starting from the first Q.

What exactly is Accounting?

Accounting is basically the bookkeeping methods which are involved in making a financial record of business transactions
(such as Purchase, Sale, Lending And Borrowing Of Loan. etc)
and in the preparation of statements concerning the assets, liabilities and operating result of a business.

Accounting is defined by the AICPA as "The art of recording, classifying, and summarizing in a significant manner and in terms of money, transactions and events which are, in part at least, of financial character, and interpreting the results."

In another terminology Accounting can be referred as the art of communicating financial information business entity to the users such as managers, directors, executives and shareholders.The information communicated is generally in a form of financial statement in monetary terms.

"It is also considered as a branch of mathematical science that is essential in discovering the success and failure of a business."

Accounting Techniques

Introduction To Basic Accounting Concepts