The information needs of a business enterprise can be outlined and illustrated with the help of the following chart: Chart Showing Types of Information Operating Information: By operating information, we mean the information which is required to conduct the day-to-day activities. Examples of operating information are: amount of wag…

Keeping Systematic Records: This is the fundamental function of accounting. The transactions of the business are properly recorded, classified and summarized into final financial statements – income statement and the balance sheet. Protecting The Business Properties: The second function of accounting is to protect the properties of …

Historical information: Accounting reports are based on the past historical information Financial information:  Accounting does not reveal non monetary information like customer satisfaction, market competition, market share, etc. Inadequate Cost information: Accounting does not provide cost information to gauge the product or depar…

Accounting may be regarded as an art of recording, classifying and summarizing of money transactions and events Accounting may be regarded as a science in its being able to use scientific and analytical techniques for solving managerial problems Accounting may be regarded as an information system for providing information needed by …

Before attempting to define accounting, it may be made clear that there is no unanimity among accountants as to its precise definition. Anyhow let us examine three popular definitions on the subject: Accounting has been defined by the american accounting association committee as: “ the process of identifying, measuring and communi…

Accounting is as old as money itself. It has evolved, as have medicine, law and most other fields of human activity in response to the social and economic needs of society. People in all civilizations have maintained various types of records of business activities. The oldest known are clay tablet records of the payment of wages i…