Characteristics of Accounting

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Traits of Accounting:

Traits of Accounting The next attributes or traits could be drawn from the definition of Accounting:

(1) Figuring out monetary transactions and occasions

  • Accounting information solely these transactions and occasions that are of monetary nature.
  • So, initially, such transactions and occasions are recognized.

(2) Measuring the transactions

  • Accounting measures the transactions and occasions by way of cash that are thought-about as a standard unit.

(3) Recording of transactions

  • Accounting entails recording the monetary transactions inappropriate e book of accounts equivalent to Journal or Subsidiary Books.

(4) Classifying the transactions

  • Transactions recorded within the books of authentic entry – Journal or Subsidiary books are labeled and grouped in keeping with nature and posted in separate accounts often known as ‘Ledger Accounts’.

(5) Summarising the transactions

  • It entails presenting the labeled knowledge in a way and within the type of statements, that are comprehensible by the customers.
  • It consists of Trial steadiness, Buying and selling Account, Revenue and Loss Account and Steadiness Sheet.

(6) Analysing and decoding monetary knowledge

  • Outcomes of the enterprise are analyzed and interpreted in order that customers of monetary statements could make a significant and sound judgment.

(7) Speaking the monetary knowledge or stories to the customers

  • Speaking the monetary knowledge to the customers on time is the ultimate step of Accounting in order that they’ll make applicable selections.
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