Accounting is an information science used to collect, classify, and manipulate financial data for organizations and individuals.

Accounting is instrumental within organizations as a means of determining financial stability. Accountants are responsible for determining an organizations overall wealth, profitability, and liquidity. Without accounting, organizations would have no basis or foundation upon which daily and long-term decisions could be made.

accounting principals
1. personnel account:- debit the receiver and credit the giver, 2. real account:- debit what comes in and credit what goes out. 3. nominal account:- debit all expenses and losses and credit all gains and incomes Debit and credit are actions that are opposite in nature

Accounting Standards
Accounting Standards are the statements that are to be observed in the preparation and presentation of financial statements. accounting standards are the written documents issued by the expert institutes or other regulatory bodies covering various aspects of measurement, treatment, presentation and disclosure of accounting transactions.

 What are the objectives of Accounting Standards? The basic objective of Accounting Standards is to remove variations in the treatment of several accounting aspects and to bring about standardization in presentation. Accounting ratios assist in measuring the efficiency and profitability of a company based on its financial reports. Accounting ratios form the basis of fundamental analysis. A way of expressing the relationship between one accounting result and another.

 The Balance Sheet, is like a snapshot taken at a particular moment in time giving a summary of the overall financial position of a business. A cash flow statement tells us where cash is coming from (inflow) and how it is being used (outflow). There are three types of cash flow-operating cash flow (sale of goods, revenue from services, interest/dividend received, payment for purchases, payment for operating expenses), investing cash flow (sale and purchase of assets, sale and purchase of debt/equity, loans advanced to others) and financial cash flow (issue of equity shares, borrowing, repayment of debt).

Bank reconciliation statement

A company's cash balance at bank and its cash balance according to its accounting records usually do not match. This is due to the fact that, at any particular date, checks may be outstanding, deposits may be in transit to the bank, errors may have occurred etc. Therefore companies have to carry out bank reconciliation process which prepares a statement accounting for the difference between the cash balance in company's cash account and the cash balance according to its bank statement.

 Deposits in Transit: Deposits which have been sent by the company to the bank but have not been received by the bank at proper time before the issuance of bank statement. Checks Outstanding: Checks which have been issued by the company but were not presented or cleared before the issuance of bank statement. Following are the transactions which usually appear in bank statement but not at company's cash account: Service Charges: Service charges may have been deducted by the bank. Such charges are usually not known to the company before the issuance of bank statement. Interest Income: If any interest income has been earned by the company on its bank account, it is not usually entered in company's cash account before the issuance of bank statement.

 In almost all businesses, it is found necessary to keep small sums of ready money with the cashier or petty cashier for the purpose of meeting small expenses such as postage, telegrams, stationary and office sundries etc. The sum of money so kept in hand generally termed as petty cash and book in which the petty cash expenditures are recorded is termed as petty cash book