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Lecture 01
Learning Objective
Financial Accounting
Lecture 01
Financial Accounting
Lecture 01
In
accounting or business terms any dealing between two persons involving money or a valuable thing is called transaction. Human beings are social animals and are bound to adopt a community living style. Living in a community essentially means that people interact with other people and are dependant on each other to fulfil their needs. Every person cannot fulfil all his needs like food, clothing, housing etc. on his own. He therefore, depends on other people to provide him with some of his needs in return to him providing others with some of theirs. This means that to get something on has to give something in return. Every instance where one gives something to get something is called a transaction.
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Financial Accounting
Lecture 01
Financial Accounting
Lecture 01
Concept Of Costing.
Financial Accounting
Lecture 01
Impact of IT On Accounting.
The old Munshi, who kept record of the financial dealings was the original accountant. But he is now of no use as the need for analysis of information recorded and forecasting based there on is a capability theMunshi lacks. In fact,there is no need for any expert in writing of books. IT has taken over. But some one has to tell the Software developer how books are written. The need for an Accountant who is well versed in the art of writing up books still remains. The role has changed. IT software can now produce the reports and analysis but the expert to interpret all of this remains. The need for the professional to describe this has not been overtaken by IT.
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Financial Accounting
Lecture 01
service is called Barter Trading. Every transaction where goods are exchanged for good is called a Barter Transaction. The Since every person cannot produce every thing that he needs. Therefore, he needs to give / sell what he produces to get / buy what he wants. In early days when money was not invented people used to exchange goods for goods. This kind of trade, where goods are exchanged for goods, is called barter trade. In fact in barter trade value of one commodity is quoted in terms of other commodity, for example the price of 10 kg of wheat may be 2 meters of cloth or 5 litres of milk.
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Financial Accounting
Lecture 01
Although there
is no involvement of money but still every commodity has a value, which means that, you have to give a specific quantity of one commodity to buy a specific quantity of another commodity
Financial Accounting
Lecture 01
Financial Accounting
Lecture 01
Translating
every transaction in terms of money does not always mean that the money changes hands the same time at which the transaction takes place. It may be paid before or after the goods are exchanged. When the money value of an item being purchased is paid at the same time the item is exchanged the transaction is said to be a cash transaction. On the other hand if the payment is delayed to a future date the transaction is termed as a credit transaction.
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Financial Accounting
Lecture 01
Sole Proprietorship
A business owned and run by a single person.
Partnership
A business owned and run by more than one persons.
Limited Company
A large organization with separate legal status.
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