Why Is The Going Concern Concept Important In Accounting?

A going concern is a business that functions without the threat of liquidation for the foreseeable future, which is usually regarded as at least the next 12 months. “Going concern” implies for the business the basic declaration of intention to keep operating its activities at least for the next year, which is a basic assumption […]

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The History Of Double-entry Bookkeeping System

Image by/from RaphaelQS Double-entry bookkeeping, in accounting, is a system of bookkeeping so named because every entry to an account requires a corresponding and opposite entry to a different account. The double-entry has two equal and corresponding sides known as debit and credit. The left-hand side is debit and right-hand side is credit. In a […]

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What Are Expenses In Accounting?

##IMAGE_HERE##Expenditure is an outflow of money to another person or group to pay for an item or service, or for a category of costs. For a tenant, rent is an expense. For students or parents, tuition is an expense. Buying food, clothing, furniture or an automobile is often referred to as an expense. An expense […]

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Why is General Ledger important In Accounting?

A general ledger is a bookkeeping ledger that serves as a central repository for accounting data transferred from all subledgers like accounts payable, accounts receivable, cash management, fixed assets, purchasing and projects. Each account maintained by an organization is known as a ledger account, and the collection of all these accounts is known as the […]

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Positive Accounting Theory Definition

Image by/from Attributed to Jacopo de’ Barbari Positive accounting is the branch of academic accounting research that seeks to explain and predict actual accounting practices. This contrasts with normative accounting, that seeks to derive and prescribe “optimal” accounting standards. Positive accounting emerged with empirical studies that proliferated in accounting in the late 1960s. It was […]

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