Class 11 Accountancy || first chapter: introduction to accountancy|| commerce part 1

             Introduction to accountancy

 class 11

                                 (commerce)

                                     Part -1

Overview-

In today’s modern business world , accountancy is not just useful - it is

essential .whether it’s a small shop or a multinational company , every

type of business involves money - income , expenses ,profits , taxes , and

Assets . Without proper accounting , a business owner would never be know

 How much profit is being made

 Where money is being split

 What position of business

 Or how to plan for the future

         

In 21st century , accounting is the language of business . Now we have to learn the other important terms of accounting .

  Historical background of accounting

The history of accounting goes back thousand of years.The earliest

records of accounting can be traced around 3000B.C where traders and

Farmers used to clay tablets to keep track of livestock and crops. Later in ancient age the most important development came in the 15

th

century LUCA PACIOLI an Italian mathematician introduced the

double entry system in his book summa de arithmetica (1494) .for

this he became the father of accounting . Meaning of accounting

Accounting is the process of recording , classifying , summarizing ,analyzing , interpreting financial transactions in

systematic manner for providing information to interested entities. Objectives of accounting

Meaning of accounting

Accounting is the process of recording , classifying , summarizing ,analyzing , interpreting financial transactions in

systematic manner for providing information to interested entities. 

Objectives of accounting

 Track daily transactions.

  To determine profit and loss

 To know the financial position

 To provide information to users

 To assist decision making

Functions of accounting

 Recording (keep day to day financial transactions in books of

accounts)

 Classifying (grouping similar transactions)

 Summarizing (preparing final accounts)

 Analyzing (examining relationships and trends in data)

 Interpreting (drawing conclusions )

 Communicating (providing financial information to user like

owners , banks , govt )

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