What is Accounting?
Accounting is the process of recording, summarizing, analyzing, and reporting financial transactions of a business. It helps businesses track income, expenses, assets, and liabilities to assess their financial health.
📌 Example: If a company sells a product for ₹10,000, accounting ensures this transaction is recorded correctly in financial statements.
Key Functions of Accounting:
- 📑 Recording Transactions (Bookkeeping)
- 🔢 Classifying & Summarizing Data (Organizing financial records)
- 📊 Analyzing & Interpreting Results (Assessing profits/losses)
- 📝 Financial Reporting (Preparing balance sheets & profit-loss statements)
- 💡 Decision-Making Support (Helping businesses plan for the future)