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CONCEPTS
WHAT IS ACCOUNTING ?
Itis asystematic processof identifying,
recording, measuring, classifying,
verifying, summarizing,interpretingand
communicating financialinformation.
It revealsprofitor loss for a givenperiod,
WHAT IS BALANCESHEET ?
Astatementofacompany'sassets,liabilities,ands
tockholder
equityatagivenperiodoftime,suchastheendof
aquarteroryear.
Abalancesheetisarecordofwhatacompanyhas
andhowithascometohaveit.
Thebalancesheetadherestothefollowing
formula:
Assets=Liabilities+Shareholders'Equity
WHAT IS ASSETS ?
Thingsthatareresourcesownedbyacompany
andwhichhavefutureeconomicvalue.
Theyaredividedintocurrentassets,thosewhich
canbeconvertedtocashinoneyearorless;and
non-currentorlong-termassets,whichcannot
WHAT IS LIABILITIES ?
WHAT IS DEBTOR ?
A person who owes money to the firm ,
generally on account of credit sale of good
is called a debtor.
E.g :- when goods are sold to a person on
the credit basis that person pays price in the
future. He is called as debtor.
WHAT IS CREDITORS ?
A person to whom the firm owes money is
called a creditor
e.g:- Mr. K.V is a creditor to the firm when
goods are purchased on credit from him.
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