1. UNIT–II: Processing transactions- Double entry system – recording of
transactions- Trial Balance- income measurement – accrual accounting –
adjustment process – preparation of financial statement.
Processing Transactions
Many business organizations have to process thousands of
business transactions. They have to record transactions
systematically so that they can prepare financial and other
statements. They use formal records to keep track of the multitude
of transactions that affect them. In this chapter, you will find out
how the accounting system records and stores the effects of any
type of business transactions, regardless of the size and complexity
of the business.
Accounts: An accounting system classifies transactions into
meaningful categories in order to prepare financial statements and
other reports. To facilitate quick and easy retrieval of data, the
company records transactions in accounts. An account is an
individual record of increases and decreases in an item that is
likely to be of interest or importance. An accounting system has
separate accounts for revenue, expenses, and asset, liability and
equity items.
Ledger: It is the file or binder that contains the entire group of
accounts of a business. Accounts in the ledger are usually
arranged in the following order: assets, liabilities, equity,
revenues, and expenses. A chart of accounts is a complete listing
of the account titles used in an organization.
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4. Recording Transactions
This includes journals, ledgers, trail balance. In the next page, you
can see the material of above. Here, study material is given in
depth with good no. of illustrations on journals, ledgers, and trail
balance. Students of Gitam Institute of Management need not go in
depth of this as we will get sums from Profit and loss account and
Balance Sheet and adjustment which is very important.
Here material is given in depth as to get knowledge of that. You
should be thorough in profit and loss account and balance sheet –
adjustments.
See this file in another document.
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accounting-processing.html
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