AN INTTRODUCTION OF FINANCIAL ACCOUNTING

2. DEVELOPMENT OF
ACCOUNTING
By
Lucas F. Pacioli
Lucas F. Pacioli, a resident of venice(Italy) is regarded as the
father of accounting . His book “De computiset
Scripturise” was published in 1494, which is regarded as
the first book on accounting.
Definition of Accounting- ‘Accounting is the art of recording ,classifying
and summarising in a significant manner and in terms of money ,
transactions and events which are of a financial character and interpreting
the results thereof .’---AICPA

5. • 1-No record of non- monetary transactions.
• 2-Legal restrictions.
•
•
• 5-No record of prospective profits.
.

6. 1-INTERNAL USERS 2-EXTERNAL USERS
A. Proprietor or Owner A.-Investors
B. Management B-Creditors
C. Employees C-Government
D-Consumers
E-Research Scholars
F-Other Persons

7. • 1-Cash system
• 2-Single Entry System
• 3-Double Entry System
• 4-Indion System of Accounts

8. • 1-Identification of Business Transactions and Events----(INPUT)
• 2-Recording of transactions in proper books of accounts---(DATA PROCESSING)
3-Classifying and Summarizing Transactions and events (i.e. ledger & final account ----(DATA PROCE.)
•
4-Analysis and interpretation & communication of financial statement---(OUTPUT)
• 1-Decision maker (Investor, creditor, supplier) , 2- Decision maker (management)

9. Recording of
transactions in
journal or
subsidiary books
Posting in
ledger
accounts
Preparation
of trial
balance
Preparation of
final statements-
Trading & P/L,
BALANCE
SHEET
Analysis &
interpretation
of Balance
Sheet