Explain Accounting stranded briefly
Answers
Answer:
An accounting standard is a common set of principles, standards and procedures that define the basis of financial accounting policies and practices. ... In the United States, the Generally Accepted Accounting Principles form the set of accounting standards widely accepted for preparing financial statements.
Answer:
Explanation:
The present age is the age of trade business and commerce. After Globalisation, liberalization, and privatization, business is increasing day by day and becoming complex also. An organization cannot remember all its dealing for long. Therefore, it becomes necessary to keep a written record of all business transactions day by day, this lead to the development of accounting. Let us understand the meaning of basic accounting.
Meaning of Accounting
Lucas Pacioli is considered to be the Father of modern bookkeeping. The only recording of financial transactions in bookkeeping is not enough to achieve the commercial objective, but also it is important to know the financial result.
It is necessary that the recorded transaction is collected, classified and summarised. This work is done by accounting. After identifying the financial transaction, through the basic accounting process, these are recorded properly in a systematic manner in the books. The meaning of accounting can be made clearer by understanding its process and components.
Accounting is a systematic process of identifying recording measuring classify verifying some rising interpreter and communicating financial information. It reveals profit or loss for a given period and the value and the nature of a firm’s assets and liabilities and owners’ equity.
According to the Committee of Terminology of American Institute of Certified Public Account:” Accounting is the art of recording, classifying summarising in a significant manner and in terms of money, transaction, and events which are, in part at least of a financial character and interpreting the results thereof.”
According to Bierman and Drebin:” Accounting may be defined as identifying, measuring, recording and communicating of financial information.”
Therefore accounting can be defined as” the process of recording, summarising, reporting and analyzing required financial information relating to the economic events of an organization to the interested users for making decisions.”
Components of Basic Accounting
1. Recording
2. Summarising
3. Reporting
4. Analyzing