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Financial Accounting:: An Introduction
Financial Accounting:: An Introduction
Financial Accounting:: An Introduction
BOOKS
Chapter 1
Financial Accounting:
An introduction
1-2
Identify a transaction
Recording
Record in Primary
Books
Record in Secondary
Books
Prepare Trial
Balance
Fundamental Accounting
Assumptions
What are the fundamental accounting
assumptions?
Accrual
Going concern
Consistency.
Why are they called “Fundamental”?
Accounting Equation
The relationship among three elements of the
balance sheet can be expressed through an
equation, known as fundamental accounting
equation:
Assets (A) = Liabilities (L) + Equity (E)
The unique feature of the above equation is that
all transactions will affect the equation in such a
way that the equality will always be maintained.
This happens due to double entry rule.