Accounting is the language of business. It is a means of communication of business information. You must have the basic knowledge of accounting to understand the performance and position of a business.
The recording part of accounting is called Bookkeeping.
Under bookkeeping, you analyze business transactions and record them in journals and ledgers according to rules and principles of accounting.
After bookkeeping, the following basic financial statements are prepared. They provide important information about the business.
1. Statement of Profit & Loss
2. Balance Sheet
3. Cashflow Statement
We use several techniques such as ratio analysis to analyze these statements to extract important information.
Basics of Accounting
- What is Accounting and Its Users in Detail
- What is Accounting Process? [Each Step In Detail]
- What is the Double Entry System?
- What is Accounting Equation? [Definition & Exercises]
- Types of Accounts [Personal, Real and Nominal]
- What are the golden rules of accounting [debit & credit]
- Accounting Principles (Explanation & Examples)
- Journal Entry: Definition, Types, and Examples
- Journal or Book of Original Entry in Accounting