Accounting | Basic Accounting for Beginners | Practice Question | Accounting Equation | Elements of Accounting In Urdu/ Hindi YouTube Video Link : https://youtu.be/lcEon7YnwNA

1. Accounting
Basic Accounting for Beginners

2. What Is Accounting
▪ Simple Accounting means language of Business.
▪ Accounting is the measurement, processing, and communication of
financial and nonfinancial information about economic activities[ such
as business and corporations.
Accounting consists of three basic activities—it
 identifies,
 records, and
 communicates
the economic events of an organization to interested users.

3. The Activities of the Accounting Process:

4. Basic Elements OF Accounting
Elements Increase Decrease
1. Asset Debit Credit
2. Liability Credit Debit
3. Owner Equity Credit Debit
4. Revenue Credit Debit
5. Expense
Debit Credit

5. Basic Elements OF Accounting
1. Asset:
 Resources a business owns.
 Provide future services or benefits.
 Cash, Supplies, Equipment, etc.
2. Liability:
 Claims against assets (debts).
 Creditors (party to whom money is owed).
 Accounts Payable, Notes Payable, Salaries and Wages Payable, etc.

6. Basic Elements OF Accounting
3. Owner Equity:
 Ownership claim on total assets.
 Investment by owners and revenues (+)
 Drawings and expenses (-).
4. Expense:
 Spend a money on items to produce Goods/ services.
 Sacrifice Money to run the business activity.
5. Revenue:
 Money earn by a firm by sacrifice their Goods or services.
 Profit

7. Accounting Equation
Asset = Liability + Owner Equity

8. Example Question:
Transactions made by XYZ Company., a public accounting firm, for the
month of July are shown below. Prepare a tabular analysis which
shows the effects of these transactions on the expanded accounting
equation.
1. The owner invested $25,000 cash in the business.
2. The company purchased $7,000 of office equipment on credit.
3. The company received $8,000 cash in exchange for services
performed.
4. The company paid $850 for this month’s rent.
5. The owner withdrew $1,000 cash for personal use.

9. 1. The owner invested $25,000 cash in
the business.
Assets = Liabilities + Owner's Equity
Transaction: Cash + Equipment = Account Payable + Owner Capital - Owner’s Drawing+ Rev – Expense
1. +25,000 +25,000

10. 2.The company purchased $7,000 of office
equipment on credit.
Assets = Liabilities + Owner's Equity
Transaction: Cash + Equipment = Account Payable + Owner Capital - Owner’s Drawing+ Rev – Expense
1. +25,000 +25,000
2. +7,000 +7,000

11. 3.The company received $8,000 cash in
exchange for services performed.
Assets = Liabilities + Owner's Equity
Transaction: Cash + Equipment = Account Payable + Owner Capital - Owner’s Drawing+ Rev – Expense
1. +25,000 +25,000
2. +7,000 +7,000
3. +8,000 +8,000

12. 4.The company paid $850 for this month’s
rent.
Assets = Liabilities + Owner's Equity
Transaction: Cash + Equipment = Account Payable + Owner Capital - Owner’s Drawing+ Rev – Expense
1. +25,000 +25,000
2. +7,000 +7,000
3. +8,000 +8,000
4. -850 -850

13. 5.The owner withdrew $1,000 cash for
personal use.
Assets = Liabilities + Owner's Equity
Transaction: Cash + Equipment = Account Payable + Owner Capital - Owner’s Drawing+ Rev – Expense
1. +25,000 +25,000
2. +7,000 +7,000
3. +8,000 +8,000
4. -850 -850
5. -1,000 -1,000
$31,150 $7,000 = $7,000 + $25,000 - $1,000 + $8,000 - $850
$38,150 $38,150

14. Prepared by Syed Arshan Ali Shah
▪ThankYou 