Introduction to Accounting

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DRUG STORE AND BUSINESS MANAGEMENT
Introduction to Accounting
Mr. Maroti M. Jeurkar Lecturer, YBCP, chandrapur
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Accounting Means What ? -Art of recording,
classifying and summarizing of Transactions of an
Organization. -Statement of Economic Position of
Particular Enterprise. -Process of Analyzing
Financial Position of the Business.
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ACCOUNTING Accounting may be defined as the
process of identifying, measuring, recording and
communicating the economic event of an
organization to the interested users of the
information.
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ACCOUNTING
identifying, Measuring recording
communicating
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• OBJECTIVES OF ACCOUNTING
• Maintain proper records of business
• Calculation of profit and loss.
• Depiction of financial position.
• Availability of information to various users.
• a)Internal user- officer and staff
• b) External users- Investor, Creditor,
  labor, tax authorities, customers etc
• 5. To comply legal requirements.
• 6. To know exact reasons leading to net profit or
  net loss.
• 7. To prevent errors and frauds.
• 8. To ascertain the progress of business from
  year to year.

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LIMITATIONS OF ACCOUNTING 1.The scope of
accounting is restricted to the limits laid down
by various laws. 2. The transaction which can not
be expressed in term of money are not recorded in
accounting 3.In accounting cost concept is
fallowed, the changing prices are not taken into
account. 4. Convention of materiality is fallowed
in accounting. Hence all material items must be
disclosed in financial statement. The immaterial
information is not recorded in financial
accounting.
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LIMITATIONS OF ACCOUNTING 5.The accounting
policies are framed by the accountants according
to there own individual judgments. It is a
subjective factor. The objective factor is
completely ignored. 6. In accounting, provision
is made on the concept of conservation for
prospective losses like bad and doubtful debts
but no provision is made for prospective profits.
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• BRANCHES OF ACCOUNTING
• Financial Accounting
• Cost Accounting
• Management Accounting
• Tax Accounting
• Social responsibility Accounting

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