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Work With UsTeach With UsFinancial accounting is a branch of accounting concerned with the summary, analysis and reporting of financial transactions related to a business.
Financial accounting is the process of recording, summarizing, and reporting a company's business transactions through financial statements.
29 Feb 2024 — 29 Feb 2024Financial accounting is the systematic process of recording, summarizing, and presenting financial transactions of a business entity.
7 Mar 2024 — 7 Mar 2024Financial accounting is the process of recording, analyzing, and summarizing the financial transactions of an organization for an accounting.
9 May 2024 — 9 May 2024Financial accounting is the process of recording, summarizing, and reporting financial transactions of a business. It involves preparing.
Financial Accounting is the process of documenting, analyzing and reporting every transaction of a business or an organization, in order to assess the financial.
Financial statements, such as the income statement, balance sheet, and cash flow statement, provide a comprehensive view of a company's financial health.
Learn the underlying principles and concepts of financial accounting, accounting techniques and the preparation of basic financial statements.
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From Financial Accounting
Outstanding expenses are expenses incurred during the period but unpaid at year end. They are added to the related expense in Profit & Loss Account (to charge full expense of the period) and shown as a current liability in the Balance Sheet. Prepaid expenses are amounts paid in advance for future periods. They are deducted from the related expense in Profit & Loss Account (to charge only current period expense) and shown as a current asset in the Balance Sheet. This ensures correct matching of expenses with the period.
Share capital may be classified as: authorised capital (maximum allowed), issued capital (part offered to public), subscribed capital (part subscribed by public), called-up capital (amount called by company), and paid-up capital (amount actually received from shareholders). This classification helps understand how much capital is legally permitted, offered, demanded and collected.
Dishonour means failure of the acceptor to pay the bill on maturity. If a bills receivable held till maturity is dishonoured, the debtor becomes liable again: Debtor’s A/c Dr. To Bills Receivable A/c. If noting charges are paid to a notary, they are recoverable from the debtor: Debtor’s A/c Dr. To Bank/Cash A/c.
Renewal means replacing a dishonoured bill by a new bill for a further period. First, the old bill is cancelled (as above). Interest for the extended period is charged to debtor: Debtor’s A/c Dr. To Interest A/c. Then the new bill is drawn for the total (bill amount + interest): Bills Receivable A/c Dr. To Debtor’s A/c. Thus, renewal records cancellation of the old bill, charging of interest, and creation of a new bill.