What
is
Accounting
What is Accounting definition:
- Accounting
is a career in
which Accountants identify events
within an organization.
- They then quantify these events in dollars and
cents so
that they can record these as journal entries or notes.
- All this is done under the
guidance of
Principles of Accounting created by the FASB or Financial Accounting
Standards
Board.
The
Accountant must recognize all economic events:
An Accountant must
recognize all events past, current and
future that will have an effect on the economic activity of an
organization.
For
example, if there is a
pending lawsuit against a company, the Accountant will at least make a
note in
the financial statements that this liability exists.
If it is known that a lawsuit will result in
payment by the company, then a liability will be set up on the
company’s balance
sheet.
Education
needed by an Accountant:
- Accounting usually is
done by degreed Accountants who should
not be confused with Bookkeepers.
- An
Accountant is more highly educated and trained to identify events that
must be
recorded and to present financial results to management or interested
parties.
Importance
of Accounting:
The
importance of accounting shouldn't be underestimated. Without
it,
no one would really know what a company's financial health was.
With well structured
principles and guidance, the Accountant
is able to report the economic conditions of a company through
the
financial statements.
Management and others can
then make good
decisions about the company.
Basic
Accounting Information:
Accounting
Terms
History of
Accounting
Basic
Accounting Principles
Accrual
Accounting
Accounting
Internal Control
Accounting
Formulas and Ratios
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