Introduction to Accounting

1. UNIT 1 :
INTRODUCTION TO
ACCOUNTING (PART
1) Accounting vs Book-
keeping

2. LEARNING
OUTCOMES
To know the meaning of the terms “accounting” and
“book-keeping”.
To know the difference between accounting and
book-keeping.
To know what is recorded in the income statement.
To know what is recorded in the statement of the
financial position.

3. ACTIVITY – RECORDING
INFORMATION
(5 minutes)
• In pairs, find out from the internet the cost of travelling by
plane to your dream holiday destination. Your search must be
based on the following assumptions:
• 1) Two way airfare for 1 person (adult) – economy class
• 2) One destination only
• 3) The cost must be in Ringgit Malaysia (estimate if in foreign
currency)
• https://youtu.be/kF6-20x8Bpo?si=zXGP_RqN0JFi4Z31

4. DECISION MAKING
• Where can you go if you have the following
budget for your airfare?
• ≤ RM1 000
• RM1 001 to RM3 000
• RM3 001 to RM5 000
• RM5 001 to RM7 000
• > RM7 000

5. ACCOUNTING: THE LANGUAGE OF
BUSINESS
Accountin
g
Book-keeping

7. WHAT IS BOOK-KEEPING ?
In the “the old days” there were no
computers, so all the information about a
business was kept in a book. Therefore,
accounting is sometimes referred to as
book-keeping. It is a process of detailed
recording of all the financial transactions of a
business. The basis used for recording is
double entry bookkeeping.

8. WHAT IS ACCOUNTING ?
Accounting uses
bookkeeping records to
prepare financial
statements at regular
interval.
Accounting involves
analyzing and
making decisions
based on the
financial
statements
prepared.

10. Why do we need accounting ?

11. WHY DO WE NEED ACCOUNTING ?
• To measure the financial performance of the
business over a
period of a time.
• Profit or loss ? (Income Statement)
• To show the financial position of a business at a
particular date.
• Assets, liabilities, and capital (Statement of financial
position).
How well did
the business
perform ?
What is the
financial position
of the business ?

12. REFLECTIO
N
What is the difference between accounting and
bookkeeping ?
Name the two financial statements and their
purposes.