what is accounting?

Accounting is the branch of knowledge which should learn everybody because it is the language of business. It means to collect, to summarize, to analyze and to report of different business transactions.

 In other words, accounting is the science of recording and classifying the business transactions and events, primarily of a financial character, and the art of making significant summaries, analysis and interpretations of those transactions and events and communicating the results to persons who must make decisions or form judgement.

 In the accounting subject, we study the meaning of accounting, the history of accounting, branches of accounting, objectives of accounting, uses of accounting,  features of accounting and limitation of accounting.  Accountant, chartered accountant or account manager  are the key people who maintains the accounting records.

Meaning of Accounting 

You can ask the meaning of accounting with following ways.

Q:- 1. What is Accounting?

It is the science to record the transactions. It is also art to transfer the values from bill, vouchers, invoices, receipts and cash memo to day book. We can explain accounting as the system of scientific recording which is used for calculating  the net profit from all the transaction. Whole accounting system is worked on the following accounting equation.

  Assets = Capital + Liability

Q:-2. What is the definition of Accounting?

Ans. To record financial transaction  is accounting.

Q:-3. What can you say about Accounting?

Ans. I can say only that accounting is the book of accounts, transaction, their record, profit and loss account and balance sheet and their analysis.

Q:- 4. What is the simple definition of Accounting?

Ans. Journal → Ledger → Trial Balance → Manufacturing Accounts → Trading Accounting → Profit and loss accounting → Balance sheet → Cost Sheets → Budgets → Trends → Ratios → Cash flow statements → fund flow statement

History of Accounting 

Main article: History of accounting

Like any other invention, accounting is the invention of India because sufficient evidence exists to lead one to conclude that the art and practice of accounting, as a highly developed system, was  in India even during the times of the Vedas. There are lots of direction in the Vedas for getting success in the trade. One of them is to record each transaction like recording any other text. Because Indians had complete knowledge of accounting, so they taught accounting to the other country's trade. We know that we had the trade with Africa. We sold many things to Africa and obtained the Gold. We had taught them to record each transaction for success in the business.


Branches of Accounting 


Main article: Branches of Accounting

Accounting is just like a tree. Financial accounting, cost accounting, corporate accounting and management accounting are its main branches.


 Accounting Software


Today, accounting records are kept with the help of accounting software. There are lots of software companies who sell accounting software in the market. You can choose anyone from them. We are providing you the top list of accounting software in the market. You should also study the list of accounting software mistakes.