what is narration in accounts
Answers
Answer:
Explanation:
Accounting Basics: All Transactions and Events are ‘Recorded’ in the Account Books called Journal/ Subsidiary Books. The recording is done through a process called as ‘Accounting-Entry’ or ‘Journal Entry’ which has two-fold effect called as Debit and Credit in Accounts.
When someone passes a journal entry the Debit and Credit effects are recorded thereby establishing the ‘completeness’ of the recording entry.
Final Answer: However, Debit and Credit simply implies that one account was Debited and other was credited; It doesn’t explain why and for what this entry was passed for!
Here comes the role of narration which is written in a small statement exactly after the entry is completed.
Narration ‘Explains’ the purpose of passing the entry.
Answer:
These are the accounts of expenses and incomes or profits and losses.
Example- Salary a/c, Rent a/c, Commission a/c,etc