1. Recording- writing business transactions and events in the book of business which is called journal. It is recorded through chronogical way.
*Journal- Accounting book where business transactions and events are recorded for the first time.
*it is chronological because the recording of business transactions and events are written according to date of its occurence. (Example: October 1, 2, 3, 4 up to 31)
2. Classifying (combining, systematic, Alphabetical Arrange)
- it is the sorting or groupings of items under the same name.
3. Summarizing
-it is the preparation of financial statement or reports.
*financial reports
A. Statement of Comprehensive Income/Income statement
-showing the results of operation at a given period of time (it might be a profit or loss)
B. Statement of Financial Position
-shows the financial condition of business at a given period of time
*Financial Condition - it shows wether the business is capable of paying its liabilities to other partners other than the owner of the business.
Statement of cashflow- it is an report showing the collection or income or disbursement.
Statement of changes in equity- it reflects the previous fund or capital of the business added to current income.
4. Interpreting
-is the explanation of the financial reports ( the no.1 interested is the owner)
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Fundamentals of Accountancy, Business and Management 1 Notes
Non-FictionThis is a notes of Fundamentals of Accountancy, Business and Management 1 subject for ABM students.
