Basic concepts3
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RECORDING TRANSACTION – FLOW CHARTRECORDING TRANSACTION – FLOW CHART
TransactionTransaction
JournalJournal
LedgerLedger
Trial BalanceTrial Balance
Financial StatementFinancial Statement
Analysis of financial statementAnalysis of financial statement
ReportReport
What is an Account?What is an Account?
An account is a summarised record of all An account is a summarised record of all transactions relating to a particular transactions relating to a particular person, a thing, or an item of income or person, a thing, or an item of income or expense.expense.
Name of the AccountName of the Account
DrDrCrCr
CLASSIFICATION OF ACCOUNTSCLASSIFICATION OF ACCOUNTS
AccountsAccounts
Personal AccountsPersonal Accounts Impersonal Impersonal AccountsAccounts
Real AccountsReal Accounts Nominal Nominal AccountsAccounts
KrishnaKrishna FurnitureFurniture SalariesSalariesGopalGopal BuildingsBuildings WagesWagesLoan from RatanlalLoan from Ratanlal MachineryMachinery InterestInterestSalaries outstandingSalaries outstanding VehiclesVehicles RentRentInsurance pre-paidInsurance pre-paid CashCash
RULES OF DEBIT AND CREDITRULES OF DEBIT AND CREDIT
Real AccountsReal Accounts
Debit what comes inDebit what comes in
Credit what goes outCredit what goes out
Nominal AccountsNominal Accounts
Debit expenses and lossesDebit expenses and losses
Credit income and gainsCredit income and gains
Personal AccountsPersonal Accounts
Debit the receiverDebit the receiver
Credit the giverCredit the giver
JOURNALJOURNALDateDate ParticularsParticulars L.F.L.F. Debit Amt.Debit Amt. Credit Amt.Credit Amt.
LEDGERLEDGERName of AccountName of Account
DateDate ParticularsParticulars J.F.J.F. Amt. Amt. Rs.Rs.
DateDate ParticularsParticulars J.F.J.F. Amt. Amt. Rs.Rs.