Branches of Accounting- BCom notes

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Branches of Accounting

Accountancy is still in the process of evaluation. Accountancy has grown with the rapid growth of business. To meets the changing requirements of the business world, accountant have also discovered various specialized Branches of accounting. The important Branches of Accounting are stated below:-


(1) Financial Accounting : It is concerned with the recording of transactions in financial books  in order to find out the trading results in term of profits or loss and financial position of the business, for a given period of time. The accounting which leads to the preparation of final accounts is called financial accounting. It is used by the proprietor, creditors, investors, employees, management, government, etc. Financial Accounting is historical in Nature.

(2)  Cost accounting : It is concerned with Classification, recording, allocation and summarisation of current and budgeted costs. The object of cost Accounting is to find out the cost of goods produced or services rendered by a business. It also helps the business in controlling the costs by indicating available losses and wastes.

(3) Management accounting : It is the presentation of Accounting information in such a way so as to assist the management in creation of policy and day to day operation of an accounting and Cost accounting for the purpose of policy formulation, planning, Controlling and decision making by the management.

(4) Social responsibility Accounting : Social responsibility Accounting is a part of Accounting which is Concerned with identifying, measuring and communicating the contribution of business enterprise to the society. Various social contribution are Environmental contribution, employment generation, providing low cost education and financial helps to weaker section of the society. Besides the above, there are Government Accounting, Tax accounting, Human Resource Accounting, Social Accounting and inflation Accounting which are in use. In this book, we are concerned with financial accounting.

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