ACCURAL SYSTEM OF ACCOUNTING
This query is : Resolved
18 November 2008
Hi
what is accural system of accounting can anyone explain me with an example
Regards
Ramanathan.V
what is accural system of accounting can anyone explain me with an example
Regards
Ramanathan.V
18 November 2008
Accrual system of accounting means booking transaction as soon as it occurs even though there is no cash outflow or inflow.
for ex: If U purchase stationary on credit for 1000 Rs, then u wil have to pass entry for it even though U have not paid Rs. 1000 to shop keeper
Entry will be: Prinitng Stationary A/c Dr
To supplier a/c
for ex: If U purchase stationary on credit for 1000 Rs, then u wil have to pass entry for it even though U have not paid Rs. 1000 to shop keeper
Entry will be: Prinitng Stationary A/c Dr
To supplier a/c
18 November 2008
It is seperate form cash systmem where entry is not passed unless cash transaction takes place
18 November 2008
ACCRUAL BASIS OF ACCOUNTING is wherein revenue and expenses are recorded in the
period in which they are earned or incurred regardless of whether cash is received or
disbursed in that period. This is the accounting basis that generally is required to be used in
order to conform to generally accepted accounting principles (GAAP) in preparing financial
statements for external users.
period in which they are earned or incurred regardless of whether cash is received or
disbursed in that period. This is the accounting basis that generally is required to be used in
order to conform to generally accepted accounting principles (GAAP) in preparing financial
statements for external users.
18 November 2008
ACCRUAL is the recognition of revenue when earned or expenses when incurred regardless of
when cash is received or disbursed.
when cash is received or disbursed.
19 November 2008
Accrual system is a method of recogonising revenue when it is earned or expenditure when it is incurred.Cash for the income and payment for the expense will be made at the later point of time.It is a process of recording income and expense at the point of Its occurance.It need not means credit basis.some sort of advance recording of transaction also included in this method.
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