"ACCOUNTING PROCESS OR ACCOUNTING TRAIL SOURCE" is the property of its rightful owner. Permission is granted to
download and print the materials on this website for personal, non-commercial use only, and to display it
on your personal computer provided you do not modify the materials and that you retain all copyright
notices contained in the materials. By downloading content from our website, you accept the terms of this
agreement.
Presentation Transcript
01
ACCOUNTING PROCESS OR ACCOUNTING TRAIL SOURCE DOCUMENTS
JOURNAL
SUBSIDIARY BOOKS
LEDGER
TRIAL BALANCE
TRADING ACCOUNT/MANUFACTURING ACCOUNT
PROFIT/LOSS ACCOUNT
BALANCE SHEET<br>
02
SOURCE DOCUMENTS BASIS OF RECORDING OF ANY FINANCIAL TRANSACTION.
MAIN EVIDENCE OF HAPPENING OF ANY TRANSACTION
DOCUMENTARY PROOF OF TRANSACTIONS
JOURNAL A PRIMARY BOOK OF ACCOUNT
ALSO CALLED AS DAY-BOOK
FIRST STEP IN RECORDING AND PROCESSING OF TRANSACTIONS
RECORDS ALL TRANSACTIONS IN A CHRONOLOGICAL ORDER
RECORDS ALL TRANSACTIONS AS AND WHEN THEY HAPPEN REGARDLESS OF THEIR NATURE<br>
04
SUBSIDIARY BOOKS A PRIMARY BOOK OF ACCOUNT
ALTERNATE OF JOURNAL
SEGREGATES TRANSACTIONS INTO CASH, BANK, SALES, PURCHASES, BILLS RECEIVABLE, BILLS PAYABLES, ETC., LIKE TRANSACTIONS
INVOLVES PREPARATION OF CASH BOOK, PURCHASE BOOK, SALES BOOK, BILLS RECEIVABLE BOOK, BILLS PAYABLE BOOK, RETURN INWARD BOOK, RETURN OUTWARD BOOK, ETC.,
SERVES DUAL PURPOSE OF PRIMARY BOOK ANS SECONDARY BOOK BY RECORDING TRANSACTIONS FOR THE FIRST TIME AS WELL AS GIVING INDIVIDUAL TOTALS OF TRANSACTION ON THE BASIS THEIR NATURE<br>
05
LEDGER OR LEDGER ACCOUNTS A SECONDARY BOOK OF ACCOUNT
TRANSACTIONS ARE POSTED FROM PRIMARY BOOKS OF ACCOUNT
CLASSIFIES TRANSACTIONS ON THE BASIS OF THEIR NATURE
GIVES INDIVIDUAL BALANCES OF ACCOUNTS AT THE END OF A SPECIFIED PERIOD OF TIME
BASIS OF PREPARING FINAL ACCOUNTS/FINANCIAL STATEMENTS<br>
06
TRIAL BALANCE ALSO KNOWN AS BALANCES ON TRAIL
PREPARED FOR THE PURPOSE OF ASCERTAININING ARITHMETIC ACCURACY OF LEDGER ACCOUNT BALANCES
ANY DEVIATION THEREOF IS RECTIFIED BY TRANSFERRING TO SUSPENSE ACCOUNT
AFTER PASSING ACCOUNT BALANCES THROUGH TRIAL BALANCE, THEY BECOME READY FOR FINAL ACCOUNT PREPARATION<br>
07
FINAL ACCOUNTS/FINANCIAL STATEMENTS TRADING ACCOUNT FIRST STEP IN PREPARING FINAL ACCOUNTS/FINANCIAL STATEMENTS FOR TRADING ORGANISATIONS
IT IS REQUIRED TO BE PREPARED BY TRADING ORGANISATIONS FOR ASCERTAING MAIN OPERATIONAL RESULTS
SUMMARISED STATEMENT OF DIRECT INCOMES AND EXPENSES
ASCERTAINS GROSS PROFIT/GROSS LOSS
MANUFACTURING ACCOUNT
FIRST STEP IN PREPARING FINAL ACCOUNTS/FINANCIAL STATEMENTS FOR MANUFACTURING ORGANISATIONS
IT IS REQUIRED TO BE PREPARED BY MANUFACTURING ORGANISATIONS FOR ASCERTAING MAIN OPERATIONAL RESULTS
SUMMARISED STATEMENT OF DIRECT INCOMES AND EXPENSES
ASCERTAINS COST OF GOODS SOLD<br>
08
PROFIT/LOSS ACCOUNT OR INCOME STATEMENT SECOND STEP IN PREPARING FINAL ACCOUNTS/FINANCIAL STATEMENTS
STARTS WITH CLOSING/BALANCING FIGURE OF TRADING/MANUFACTURING ACCOUNT
PREPARED FOR THE PURPOSE OF ASCERTAINING INCOME POSITION OF AN ORGANISATION
TAKES CLOSING BALANCES OF ALL OTHER INCOME/GAIN ACCOUNTS AND EXPENSE/LOSS ACCOUNTS
CALCULATES NET PROFIT/LOSS OF BUSINESS ORGANISATION<br>
09
BALANCE SHEET or POSITION STATEMENT END STATEMENT OF ACCOUNTING PROCESS
ASCERTAINS FINANCIAL POSITION OR POSITION OF ASSETS AND LIABILITIES OF AN ORGANISATION
MAIN STATEMENT OF OVERALL PERFORMANCE AND STATUS OF AN ORGANISATION
DEPICTS OWNERS EQUITY, OUTSIDERS LIABILITY AND NETWORTH OF AN ENTITY<br>
