DEFERRED REVENUE EXPENDITURE
Deferred Revenue Expenditure is a revenue expenditure that is incurred during an accounting period but it's benefit extends beyond that accounting period ,i.e., is not exhausted within the accounting period . Such an expend…
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DISHONOUR OF A BILL
Dishonour of a Bill means a situation when the acceptor of the bill refuses or is unable ( say because of insolvency ) to pay the amount . In such a case , the holder of the bill can recover the amount from the Drawer or any o…
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ACCOUNTING TREATMENT OF ITEMS OF INCOME AND EXPENDITURE ACCOUNT
1. Entrance Fee/Admission Fee: Entrance Fee or Admission Fee is the amount paid by a person at the time of becoming a member of a Not - For - Profit Organisation . Entrance Fee or Admission Fee is a revenue receipt and therefore…
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FUND BASED ACCOUNTING
Donation received or funds set - up for specific purpose is credited to a separate fund account and is shown in the Liabilities side of the Balance Sheet . The incomes from or donations for these funds are credited to the funds…
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ADJUSTMENTS OF CLOSING STOCK IN FINAL ACCOUNT
Normally , all goods purchased or produced during the accounting year are not sold by the end of the year . The goods remaining unsold at the year end is closing stock . Since closing stock is known only at the end of the year,…
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MEANING AND CONCEPT OF NOT - PROFIT ORGANIZATION
Meaning Not - For - Profit Organization , also known as Non - Profit Organization , is an organisation set - up to render to the members or to the society without earning profit . Although it's aim is not to earn profit , ho…
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CLASSIFICATION OF CAPITAL AND REVENUE ITEMS
Trail Balance having been prepared , the accounts appearing therein are transferred either to the Trading Account ( if it is prepared ) or to the Profit and Loss Account or to the Balance Sheet . Items appearing in the Trail Bala…
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OPERATING PROFIT AND NET PROFIT
Profit may be divided into two ,i.e., 1.Operating profit . 2.Net profit . Operating profit means from operating activities of the business . It is excess of gross profit over operating expenses . Gross profit…
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CHARACTERISTICS OF BALANCE SHEET
The characteristics of balance sheet are 1 . It is prepared at a particular date and not for a particular period . 2. It is prepared after the preparation of Profit and Loss Account . This is the reason why the profit and lo…
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BALANCE SHEET
Balance Sheet may be defined as " A statement which sets out the assets and liabilities of a firm or an institution as at a particular date ." Having prepared the Trading and Profit and Loss Account , Balance Sheet is …
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PROFIT AND LOSS ACCOUNT
Meaning Profit and Loss Account is prepared after Trading Account . Profit and Loss Account is prepared to determine Net Profit earned or net Loss incurred by the business during an accounting period. " A profit and loss …
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TRADING ACCOUNT
Meaning Trading Account is the first stage in the process of preparing the final accounts . Trading Account shows gross profit earned or Gross loss incurred during the accounting year .It is credited with sales , services render…
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USERS OF FINANCIAL STATEMENTS
The information in the financial statements is of interest to a number of internal and external parties . They include : Internal Users 1. Owners : Owners contribute capital in the business and thus bear maximum risk . They …
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FINANCIAL STATEMENTS
Meaning Financial Statements are the prepared at the end of the accounting period to show financial performance during the accounting period and financial position of the business as on date . A complete set of Financial Stateme…
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RECTIFICATION OF ERRORS
Classification of Errors Keeping in view their nature , errors can be classified into following four categories : Errors of Omission Errors of Commission Errors of Principle Compensating Errors 1. Errors of Omission An Error …
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- My name is Rohit Shrivastav I live in delhi my blog related to education
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