Category Archives: Finance

Cash Book – Meaning, Types of Cash Book, explanation with examples

Cash Book

Cash Book – Every business activity ultimately result in cash, therefore, recording of transaction involving cash must be recorded in a separate journal. This journal is called cash book. It may be defined as the record of transaction relating to receipt of and payment in cash. Meaning of Cash Book A Cash Book is a special […]

Trial Balance – Meaning, Features, Preparation, Purpose, Types

Trial Balance

Trial Balance – We know that the fundamental principle of Double Entry System id accounting is that for every debit, there must be a corresponding credit, thus, for every debit or a series of debits given to one or several accounts, there is a corresponding credit or a series of credit of n equal amount […]

Petty Cash Book – Meaning, Cash Book Vs petty cash Book (all details)

Petty Cash Book

Petty Cash Book – The cash book as seen above is used for recording all major payments. But, in every business a number of petty (small) Payment like that for postage, carriage, stationery, entertainment, cartage, conveyance etc. are paid frequently even in a single day. If all these petty expenses are to be recorded in the […]

Journal – Rules of Journalizing, Functions, Explanation & Examples

CAknowledge Financial Dictionary

Journal Introduction:- The word ‘Journal means’ a daily record. Journal is derived from French word ‘Jour’ which means a day. It is a book of original or prime entry written up from the various sources documents. Every transaction is recorded in the first instance and than it is posted to the ledger. The form in […]

Double Entry System – Features, definition, explanation and examples

CAknowledge Financial Dictionary

Double Entry System – Under this system a proper and full record of all transaction is made every transaction has a double or dual aspect. It is based upon the principal that every receiver implies giver and every giver implies receiver. This method writhing every transaction in two accounts is given debit side and the other […]

Dual Aspect Concept – meaning, definition with examples (all details)

CAknowledge Financial Dictionary

Dual Aspect Concept – Every Transaction has two effects: Debit and Credit. Both are opposite and equal also known as Double Entry System. Accounting equation has been derived on the basis of dual aspect concept as under: Assets = Liabilities + Equity (Balance Sheet Equation) Net Profit = Income – Expenses (Profit & Loss Equation) Dual […]

Conservatism Concept – meaning, definition with examples

CAknowledge Financial Dictionary

Conservatism Concept – Conservatism states that the accountant should not anticipate income and should provide for all possible losses. When there are many alternative values of an asset, an accountant should choose the method which leads to the lesser value. Later on we shall see that the golden rule of current assets valuation – ‘cost or market […]

Cost Concept – Meaning of Cost Concept (All you need to know)

CAknowledge Financial Dictionary

Cost Concept – By this concept, the value of an asset is to be determined on the basis of historical cost, in other words, acquisition cost. Hence, All the fixed assets are recorded at Historical Cost only and market value of fixed assets is ignored. In accounting, the cost principle is part of the generally accepted […]

Going Concern Concept – definition, explanation and examples

CAknowledge Financial Dictionary

Going Concern Concept  – The financial statements are normally prepared on the assumption that an enterprise is a going concern and will continue in operation for the foreseeable future. Hence, it is assumed that the enterprise has neither the intention nor the need to liquidate or curtail materially the scale of its operations; if such an […]

Accrual Concept – Meaning of Accrual Concept (All you need to know)

CAknowledge Financial Dictionary

Accrual Concept – Accrual means recognition of revenue and costs as they are earned or incurred and not as money is received or paid. Expenses accrue when benefit is received and income is accrued when benefit is given. Accrual Concept in Detailed – Under accrual concept, the effects of transactions and other events are recognised on […]