To in this
article let us try to understand about Book keeping and accounting. Many of us
don’t know or we may have forget - what is book keeping ? what is accounting ?
what are their objectives and different types of accounting or forms of
accounting. So today in this article let us understand it.
What is Book Keeping
According
to Northcot “Bookkeeping is the art of recording in the books of accounts the
monitory aspect of commercial and financial transaction.”
According
to J.R. Botliboi “Book Keeping can be defined as Science & Art of recording
business transaction under appropriate accounts.”
Meaning of Bookkeeping
Thus
Book Keeping is recording business transaction in appropriate books of
accounts in a systematic manner. So that we can ascertain the
profit or loss & the financial position of business or firm.
Objectives of Bookkeeping
The objectives of book keeping are as follows,
- To have permanent
records of all the business transactions for future references.
- To
ascertain the net results i.e. net profit or net loss in the business of
any particular accounting period.
- To
know the exact reason leading to net profit or loss.
- To
ascertain what accounts are due to business and from whom the amounts are
due.
- To
assess the progress of business from year to year.
- To
have valuable information for legal as well as tax purposes.
- To have required information for forecasting.
I hope now you have understood what is book keeping? Objectives of book keeping. To conclude, Book keeping is the art and science of recording
transactions under appropriate accounts.
Comments
Post a Comment