accounting and financial management project no. 1-2
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8/3/2019 Accounting and Financial Management Project No. 1-2
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Accounting and Financial
ManagementGroup Members:
Azhar Khan
Fauzia Khan
Ahmad FarrukhFatima Khatoon
Arshiya Farooqui
Inesh Rakhimbekova
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IS A PROCESS OF IDENTIFYING, MEASURING, RECORDING, CLASSIFYING,SUMMARIZING & ANALYZING MONETARY TRANSACTIONS OF A BUSINESS.
TO KEEP SYSTEMATIC REPORT
TO PROTECT BUSINESS PROPERTIES
TO ASCERTAIN THE OPERATIONAL PROFIT AND LOSSES
TO ASCERTAIN THE FINANCIAL POSITION OF BUSINESSTO FACILITATE RATIONAL DECISION MAKING
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Accounting replace human memoryAccounting helps in knowing profit
Helps in knowing financial position of organization
Helps in paying taxes
Accounting helps in raising ore funds by supplying information to
investors and creditorsHelps in planning for expansion
Helps in getting bank loan
Accounting does not provide timely information
Accounting ignores the importance of non monetary information
Accounting does not provide detail analysis
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the amount of money invested by anentrepreneur in its business from its own resources.
all tangible and intangible things which can be converted into cash or which
can fetch some money value at an point of time for the business.are assets which change over a long period of time
usually more than 1 year e.g. Land, building, machine
assets which can be converted into cash in a short period usuallywithin 1 year.
the amount borrowed from outsiders which has to be paid in future.
amount paid for using services or for goods.expenses which are paid in advance but goods or services are
not received yet.
expenses which are not paid for yet but goods or serviceshave been received.
revenue or earning by a business
income which is earned but not yet received.Income received In advance income which is not yet earned but received.
those people from whom the goods/services have been purchased oncredit and money has to be paid in future.
those people to whom goods/services have been sold on credit andmoney has to be received in future.
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DOCUMENTS, WHICH COMMUNICATE THESE
FINDINGS ABOUT THE PERFORMANCE OF AN ORGANIZATION IN
MONETARY TERMS.
AN AMOUNT WITHDRAWN BY THE OWNER FROM THE
BUSINESS FOR HIS PERSONAL USE.
ACCOUNTING EQUATION
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RECORDING OF ONLY THOSE
TRANSACTIONS WHICH CAN BE EXPRESSED IN MONETARY TERM.
A BUSINESS UNIT IS A SEPARATE ENTITY WITH ITS OWN IDENTITY AND IS
DISTINCT FROM THE OWNERS OF THE ENTERPRISE.
AN ARTIFICIAL PAUSE TO PREPARE A
FINANCIAL STATEMENT.
ASSUMED THAT THE BUSINESS ENTITY
WOULD CONTINUE TO OPERATE FOR AN INDEFINITELY LONG PERIOD IN
FUTURE.
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the assets/resources owned by the firm should be shown at the acquisitioncost and not at their current market value.
not to anticipate profits before they are actually realized but always
recognize & provide for all probable future losses.
expenses incurred/revenues earned should be considered as
expenses/revenues of the same accounting period irrespective of it being
paid or received in advance or is outstanding.
Should be consistency in recording a specific item so that
it ensures comparability over the years.
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These accounts include accountsrelated to persons, debtors, creditors.
Eg. The account of XYZ company.
Dr. THE RECEIVER
Cr. THE GIVER
These are the accounts which relate to the assetssuch as machinery account, land and building accounts, etc.
Dr. WHAT COMES IN
Cr. WHAT GOES OUT
These are the accounts related to income,expenses, gains &losses.
E.g. Wages paid account, purchases account, sales account etc.
Dr. EXPENSES &LOSSES
Cr. INCOMES &GAINS
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