Notesale: Turn your study into money

Document Preview

Extracts from the notes are below, to see the PDF you'll receive please use the links above

---

Accountancy Notes Chapter-2 Theory Base Of Accounting
This chapter talks about some of the important basic concepts of Accountancy
...
Students are advised to
refer to the CBSE revision notes provided by Extramarks to comprehend the chapter
with thorough explanations
...
The revision notes serve as reliable
study material for the students
...
They act as a complete study tool and explain
the fundamentals of the chapter clearly
...
Such a declaration must be written in standard language and adhere to norms
and regulations
...

Features of Accounting Principles:
● Accounting principles are man-made
...

● Accounting concepts are flexible in nature
...

Accounting Principles Types
● Concept of continuing concern: According to this notion, it is considered that the
business will continue to operate for a long time in the future, and transactions
are recorded in the books of business based on this assumption
...
It allows them to compare and contrast
profit and loss over time and develop relevant conclusions
...
Compared to a cash basis, it delivers more accurate information about
the business
...

Concept of monetary measurement: Only those transactions that can be stated in
monetary terms are recorded according to accounting norms
...

The two-sided idea: It is the foundation for the double-entry accounting system,
which means that all accounts have two sides: debit and credit
...

The idea of price: According to this idea, the asset has usually documented the
price paid or incurred to acquire it
...
A 12-month accounting
term is common
...

Realization concept or revenue recognition: According to this principle, revenue
should only be accounted for when it is realized or when it is sure that it will be
achieved
...


Accounting Conventions
It is a custom or widely accepted practice among accountants, either by broad
agreement or common consent
...

● Materiality Convention: It necessitates the disclosure of significant facts whose
omission might impact decisions
...

● Conservative Convention: The core of this idea is to “expect no profit and plan for
all conceivable losses
...


Accounting Standards

Accounting standards are written declarations released by the accounting professions
association from time to time that specifies standardized rules or methods for the
financial statements
...

Benefits of Accounting Standards
● The financial statements are more reliable when accounting standards are
followed
...

● Accounting guidelines ensure that financial statements are consistent and
comparable
...

Except for solely philanthropic organizations, accounting standards apply everywhere
...
All IFRS requirements should be followed to make financial statements more
uniform and transparent
...

Comparisons are simple to create
...

Asset valuation that is accurate and fair
It’s complex to defraud people and alter accounts
...
One Nation, One Tax is the foundation of the GST
...
GST covers the entire country,
including Jammu and Kashmir
...

In the case of GST, the burden might be shifted
...

Its nature is regressive, and it promotes social welfare
...


Benefits of GST
●
●
●
●

Doing business is simple
...

The tax system has become more straightforward, systematic, and predictable
...


GST Includes Three Types of Taxes:
● Central Goods and Services Tax (CGST)
● State Goods and Services Tax (SGST)
● Integrated Goods and Services Tax/ Union Territory Goods and Services Tax
...
Going over the notes will allow students to become
acquainted with the fundamentals of the subject
...
These notes provide a thorough and in-depth explanation of the
concepts
...
Such ideas are generally
recognized across the board, and they can be tweaked as needed
...
The following are the fundamental assumptions:
● Going concern assumption: Enterprise retains its experience indefinitely
...

● Assumption of accrual: Revenues and costs are only recorded when they are
generated or expended
...

Accounting Standards
Accounting standards, which specify standardized methods and rules for financial
accounts, are developed by accounting organizations from time to time
...
In this way, the credibility of such comments improves
...

Financial Statements Using IFRS
Financial statements include the Complete Income Statement, Statement of Financial
Position, Statement of Cash Flow, and Statement of Changes in Equity
...
Invariably, the remarks
would include country-specific standards
...

Nature of Accounting Standards
Accounting standards include principles that establish a sound framework for
constructing financial statements
...

These accounting processes are all the same
...
Accounting standards are adaptable, and an organization can use any
accounting method it wants
...




---