2. Objective of this Subject
To help students understand the accounting
concepts and principles, as well as to develop
the capability to perform the basic
accounting functions: the recognition,
valuation, measurement and recording of the
most common business transactions.
3. Contents
Book Keeping
Accounting
Accountancy
Relationship
between book
keeping, Accounting
and accountancy
Objectives of
Accounting
4. Book Keeping
Book-keeping is a
primary and basic
function in the
process of accounting
and concerned with
recording and
maintenance of books
of accounts only.
5. In this process the following basic activities
are considered essential:
Identification of the transactions from the
various business transactions, which have
financial character;
Measurement of those transactions in terms
of money;
Recording those transactions in the books of
original entry;
Classification of the transactions keeping in
view the respective ledger accounts.
7. In this process the following basic activities
are considered essential:
Summarization of the classified transactions
in the shape of final accounts;
Analysis and interpretation of the results
disclosed by final accounts and drawing
meaningful conclusions;
Communicating the required information to all
the concerned parties.
8. Accountancy
Accountancy is a study of systematic
knowledge and contains those rules,
regulations, procedures, principles, concepts,
conventions and techniques, which are to be
applied in the process of accounting.
9. In this sense, we can say that accountancy is
a broader term that acts as a guide for the
preparation of books of accounts,
summarization of information and
communicating the results to all the
concerned parties.
