The balance sheet gives us the financial position of the
business and profit and loss account. Accounting accounting is
nothing but recording classifying and summarizing the financial
data into meaningful format that is all accounting is right so
now let 's see the accounting process. The accounting process
is very simple accounting process starts with the source
document. The process from source document till trial balance
it is called bookkeeping. An asset is a resource controlled by an
entity as a result of past events and from which future
economic benefits are expected to flow to the entity that is
what an asset is now previously we used to say that asset is
something that the company owns if company owns the land
and building then that 's an asset of the company'
Expenses are the cost of operations that a company incurs to
generate revenue and from which no further benefit is
expected is the main difference between a certain expenses
that you know in acid we get future economic benefit but here
once you incur the expenses that means you have taken the
benefit already the benefit is already taken. so see here a
present obligation of the entity to transfer an economic
resource as a result of past event there will be some past
event for example you purchase you know ten thousand worth
of goods yeah and you did n't pay then you have present
obligation to pay that person pay to pay your supplier. If you
owe money to your supplier then that supplier that creditor he
will have claim on your total assets of the company. Capital is
simply whatever money that is brought in by the owners of the
company that's called capital or equity share capital or
preferential capital simple as that. The technical definition
would be it is the claim of owners in the total asset of the.
company after deducting all it 's liabilities. shareholders
because they 're in companies the capital is divided into small
small units of shares.
Sales is our revenue and then rendering of services if it 's a
service business then we will render the services and we will
get the money etc and also interest received all these things
okay other things also etc mean side interest receive rent
receive whatever it is dividend receive whatever we get that 's
called running simple as that' Let 's say you purchased a
machinery to do business yeah you wanted to do some
production or something yeah so of course your cash will
reduce. Now there is an obligation that is being created that
you have to pay 40,000 back to the bank is n't it so this
obligation is called a present obligation. Before you had claim
business and profit and loss account. Accounting accounting is
nothing but recording classifying and summarizing the financial
data into meaningful format that is all accounting is right so
now let 's see the accounting process. The accounting process
is very simple accounting process starts with the source
document. The process from source document till trial balance
it is called bookkeeping. An asset is a resource controlled by an
entity as a result of past events and from which future
economic benefits are expected to flow to the entity that is
what an asset is now previously we used to say that asset is
something that the company owns if company owns the land
and building then that 's an asset of the company'
Expenses are the cost of operations that a company incurs to
generate revenue and from which no further benefit is
expected is the main difference between a certain expenses
that you know in acid we get future economic benefit but here
once you incur the expenses that means you have taken the
benefit already the benefit is already taken. so see here a
present obligation of the entity to transfer an economic
resource as a result of past event there will be some past
event for example you purchase you know ten thousand worth
of goods yeah and you did n't pay then you have present
obligation to pay that person pay to pay your supplier. If you
owe money to your supplier then that supplier that creditor he
will have claim on your total assets of the company. Capital is
simply whatever money that is brought in by the owners of the
company that's called capital or equity share capital or
preferential capital simple as that. The technical definition
would be it is the claim of owners in the total asset of the.
company after deducting all it 's liabilities. shareholders
because they 're in companies the capital is divided into small
small units of shares.
Sales is our revenue and then rendering of services if it 's a
service business then we will render the services and we will
get the money etc and also interest received all these things
okay other things also etc mean side interest receive rent
receive whatever it is dividend receive whatever we get that 's
called running simple as that' Let 's say you purchased a
machinery to do business yeah you wanted to do some
production or something yeah so of course your cash will
reduce. Now there is an obligation that is being created that
you have to pay 40,000 back to the bank is n't it so this
obligation is called a present obligation. Before you had claim
