The document summarizes the matching concept in accounting. It states that the matching concept is the basis for accrual accounting and requires that expenses in a period be matched with the revenues for that period to avoid misstating earnings. It also provides an example trial balance and shows how to prepare a trading account, profit and loss account, and balance sheet from the trial balance information.

1. Siilas campus
Presentation
Fundamental of Accounting
BY- VINAY KUMAR VERMA
BBA/1/A/36

2. Index
 Matching concept
 Final account without adjustment

4. Matching Concept
 The matching concept is the basis on which the accrual accounting
method keeping is built.
 The matching concept is the based on the principle that the expenses
for a particular accounting period should be matched with the
revenues for that period only.
 The purpose of the matching concept is to avoid misstating earnings
for a period. reporting revenues for a period without reporting all the
expenses that brought them could result in overstated or understated
profit .

5. Matching concept recognition
In the US and in many other countries accounting concepts
such as the matching concept and accrual accounting are
recognized in the GAAP (Generally Accepted Accounting
Principle) and organization behind GAAP (i.e. the Financial
Accounting standard board, FABS). Other accounting concept
similarly recognized including materially concept.

7. Final Account Meaning
Is quite natural that the businessman is interested in
knowing whether his business is running on profit or
loss and also the true financial position of his business.
The main aim of Booking is to inform the proprietor,
about the business progress and the financial position
at the right time and in right way. Preparation of final
account is highly possible only after the preparation of
trial balance.

8. Types of Final Account
There is three types of Final Account :-
 Trading Account
 Profit and Loss Account
 Balance Sheet

12. Example
From the following trial balance of Anil
kumar, prepare Trading and Profit &
Loss account for the year ending 31
March, 2006 and balance sheet as on that
date.

13. DEBIT BALANCE AMMOUNT CREDIT BALACE AMMOUNT
Opening stock 31,350 Sales 4,02,160
Purchases 2,80,000 Purchases Returns 1,150
Sales Returns 2,000 Creditors 62,000
Carriage Inward 8,710 Discount 90
Wages 58,840 Capital 50,000
Coal, gas, water 42,860
Manufacture expenses 4,840
Debtors 67,900
General Expenses 4,890
Salaries 4,300
Rent, Rates and taxes 1,910
Cash in Hand 70
Drawings 3,000
Total 5,15,400 Total 5,15,400
Closing Stock As on 31st march 2006 Rs. 53,000

14. Particulars Amount Particulars Amount
To opening stock 31,350 By sales
To purchases 2,80,000 Less : sales returns 2,000 4,00,160
Less : purchases return 1,150 2,78,850 By closing Stock 53,800
To carriage 8,710
To wages 58,840
To Coal, gas, water 42,860
To manufacturing expenses 4,840
To Gross profit c/d 28,510
4,53,960 4,53,960
To salaries 4,300 By Gross profit b/d 28,510
To rent, rates and taxes 1,910 By Discount 90
To general expenses 4,890
To net profit trans. To capital a/c 17,500
28,600 28,600
Trading And Profit & Loss account
For the year ending 31st march 2006

15. Liabilities Amount Assets Amount
Sundry Creditors 62,000 Cash in hand 70
Capital 50,000 Cash at bank 4,730
Add: Net profit 17,500 Sundry debtors 67,900
Closing stock 53,800
Less : Drawings 3,000 64,500
1,26,500 1,26,500
Balance sheet
As on 31st march 2006