Orientation & Introduction to
Fundamentals of Accounting
Is a service activity, its function is to provide quantitative information primarily financial in nature
about economic entitles that is intended to be useful in making economic decisions.
Is a process of identifying, measuring and communicating economic information to permit
informed judgements and decisions by the users of information.
Is the art of recording, classifying and summarizing in a significant manner, transactions and
events which are in part at least of a financial character and interpreting the result thereof.
Nature of Accounting
Accounting is a service activity. Services are intangible product (i.e. they cannot be seen or
touched as opposed to goods|) performed to clients or customers. Examples: Legal Services of
Lawyers, Health Care Services of our Medical Frontliners, and of course the Accounting. Audit,
Tax, and Management Consultancy Services of Accounting which provides quantitative financial
information (information expressed in numbers, quantities or units particularly in money)
Accounting is a process. It involves systematic methods to perform tasks to achieve objectives.
1. Identifying – the process of recognition or non-recognition of business transactions as
accounting events for recording purposes. Note: the event is said to be accountable when
it affects the assets, liabilities, equity, income and expenses of a business.
2. Measuring – the process of assigning peso value or amount to the identified accountable
event.
3. Communicating – the process of preparation and distribution of financial reports. The
information from different transactions and events identified, processed, measured in
accounting information system to produce meaningful reports commonly known as
financial statements.
Accounting is a practical art. It consists of define techniques and its proper application requires
the use of creative skills, functions, expertise and judgement.
1. Recording – the preparation of journal entry in the process called journalizing.
2. Classifying – the grouping of accounts with similar nature and characteristics
3. Summarizing – the preparation of financial reports
4. Interpreting – the analytical function
Accounting is a social science. It is a body of knowledge which has been systematically gathered,
classified and organized.
Function and Purpose of Accounting in Business
Fundamentals of Accounting
Is a service activity, its function is to provide quantitative information primarily financial in nature
about economic entitles that is intended to be useful in making economic decisions.
Is a process of identifying, measuring and communicating economic information to permit
informed judgements and decisions by the users of information.
Is the art of recording, classifying and summarizing in a significant manner, transactions and
events which are in part at least of a financial character and interpreting the result thereof.
Nature of Accounting
Accounting is a service activity. Services are intangible product (i.e. they cannot be seen or
touched as opposed to goods|) performed to clients or customers. Examples: Legal Services of
Lawyers, Health Care Services of our Medical Frontliners, and of course the Accounting. Audit,
Tax, and Management Consultancy Services of Accounting which provides quantitative financial
information (information expressed in numbers, quantities or units particularly in money)
Accounting is a process. It involves systematic methods to perform tasks to achieve objectives.
1. Identifying – the process of recognition or non-recognition of business transactions as
accounting events for recording purposes. Note: the event is said to be accountable when
it affects the assets, liabilities, equity, income and expenses of a business.
2. Measuring – the process of assigning peso value or amount to the identified accountable
event.
3. Communicating – the process of preparation and distribution of financial reports. The
information from different transactions and events identified, processed, measured in
accounting information system to produce meaningful reports commonly known as
financial statements.
Accounting is a practical art. It consists of define techniques and its proper application requires
the use of creative skills, functions, expertise and judgement.
1. Recording – the preparation of journal entry in the process called journalizing.
2. Classifying – the grouping of accounts with similar nature and characteristics
3. Summarizing – the preparation of financial reports
4. Interpreting – the analytical function
Accounting is a social science. It is a body of knowledge which has been systematically gathered,
classified and organized.
Function and Purpose of Accounting in Business
