Accounting, as defined by Investopedia, is the process of recording financial transaction pertaining to business. https://www.investopedia.com/terms/a/accounting.asp
The process of accounting involves several phases:
1. ANALYZING the effects of certain financial events to the business enterprise.
2. RECORDING the transactions and events in the business books. Because businesses can have voluminous transactions in a given period, then it is necessary for:
3. SUMMARIZING these transactions and events in the form of obtaining balances of these accounts, and
4. REPORTING the balances of accounts to various interested parties in the form of financial statements.
--------------------------------------------------------------------------------------------------------------------------
COMMENT:
When I was still in school, it seemed too hard for me to memorize things coming out of textbooks as these tend to be very technical, boring, and frankly--- devoid of excitement. Imagine being asked about the definition of accounting!!! Arrrrrgh!!!
What I usually did was paraphrase definitions. Since it seemed it was necessary to include components of the process, I did mnemonics: ARSR. I correlated it with hindquarters with an extra umph: ARS(e) (Grrr)R. Weird, huh?
--------------------------------------------------------------------------------------------------------------------------
Comments
Post a Comment