ACCOUNTING
In
ENGLISH LANGUAGE
Theory And Application
Chapter(1)
Accounting concepts and –
principles –
Chapter(1)
After reading this chapter,
you should be able :
(1) Define Accounting .
(2) Name And Explain
Accounting Concept
And Accounting Principles
(3) Eeplain The Main Basics
Of Accounting
Definition Of Accounting
What is accounting ?
(1)Accounting is a service activity the function
of which is to provide quantitative information
about economic entities
The information is primarily financial in nature
and is intended to be useful in making rational
economic decisions.
(2) Accounting is the art of recording
,classifying,reporting,and interpreting
the financial data of an organization.
(3)Accounting is asocial science has its •
concepts and principles that used in
applying the accounting cycle to
achieve accounting functions and
objectives
Accounting cycle
• Consists the steps involved in handling business
transaction completed in an accounting period ,------starting with analyzing and recording the
transactions in a journal and ending preparing
trail balance.
• Journalizing……….. Recording
transactions in a journal.
• Posting ………….. From journal to a ledger.
• Summarizing……. Trail balance .
Accounting cycle
No entry
No
Yes
Business
Transaction
Is this
Accounting transaction
Preparing
Financial
Accumulation and
Summarizing
statements
(posting &preparing trail balance)
Analysis the
transaction
Recording
In
a journal
ACCOUNTING CONCEPTS
Accounting concepts refer to
the nature of the economic
environment in which
accounting operates .
The most significant of these
concepts(assumptions)are:
(1) The entity concept –
(2) The going-concern
concept.
(3) The unit of measurement
concept.
(4) The periodicity concept .
PRINCIPLES OF ACCOUNTING
– Accounting principles are
• broad rules adopted by the accounting
profession as guides for
• use in recording and reporting the
financial affairs and activities of a
business to its
• owners ,investors,creditors,and other
outsiders
(
Accounting principles are :
(1) COST PRINCIPLE
(2) OBJECTIVITY PRINCIPLE
(3) REALIZATION PRINCIPLE
(4) MATCHING PRINCIPLE
(5) PRINCIPLE OFCONSERVATISM
(6) CONSISTENCY
(7) FULL DISCLOSURE PRINCIPLE
(8) MATERIALITY PRINCIPLE
Self-study questions(chapter1
1.
the principle that dictates ‫يملى‬that expenses be matched with
revenues is the :A . Matching principle .
B. cost principle .
C. revenue recognition principle
D. full disclosure .
2.
Using the accounting procedures from year to year means :A. conservatism .
B. consistency .
C. matching .
D. materiality .
3. All material information should be disclosed in the
financial statements to make these statements clear
and understandable for the readers is :a.
b.
c.
d.
Materiality
Matching
Full disclosure .
Consistency .
4. All of the following represents outside party interest in accounting
reporting except :•
•
•
•
Management .
Debtors .
Creditors .
Taxation authorities .
• 5 .Accounting includes :A. measurement .
B. reporting .
C. verification .
. D. all of the above .
• the life of abusiness is divided into periods of equal
length as amonth,three month ,or ayear :
• annual accounting periods are the most common .
this is the accounting periods(periodicity concept
Accounting Terminology
In
Arabic language
‫الرقم‬
‫المصطلح‬
1
accounting
2
Account
3
Accountancy
4
Accountant
5
Accounting Principles
6
Accounting cycle
7
Accounting concepts
‫المعنى‬
‫المحاسبة‬
‫حساب‬
‫علم المحاسبة‬
‫المحاسب‬
‫المبادى المحاسبية‬
‫الدورة المحاسبية‬
‫المفاهيم المحاسبية‬
‫المعنى‬
‫تصنيف الحسابات‬
‫المصطلح‬
‫الرقم‬
‫غير محدد‬
‫االصول‬
‫‪Classification of‬‬
‫‪accounts‬‬
‫‪Indefinite‬‬
‫‪8‬‬
‫‪9‬‬
‫‪Assets‬‬
‫‪10‬‬
‫االلتزامات‬
‫‪Liabilities‬‬
‫‪11‬‬
‫حقوق الملكية‬
‫‪Owner’s equity‬‬
‫‪12‬‬
‫راس المال‬
‫‪Capital‬‬
‫‪13‬‬
‫التصفية‬
‫‪Winding up‬‬
‫‪14‬‬
Chapter (2)
RECORDING ACCOUNTING •
TRANSACTION
Chapter (2).
After reading this chapter ,you should be •
able to :-
(1)know how to distinguish between •
accounting and non accounting
transaction.
(2)show how to record accounting •
transaction in journal using double
entry system.
(3)write the general rules of journal. •
what is a business transaction ?
Any business transaction is an accounting transaction if :(1) There is real exchange between two parties through
arm’s length transaction .
(2) There is an effect for this transaction on any of the
elements accounting: assets ,liabilities ,and or owner’s
equity.
Double entry :Double-entry-accounting is an accounting system in
which each transaction affects and is recorded in two
Or more accounts with equal debits and credits .
Classification of accounts:--(1) Personal accounts are the accounts in
personal names including all types of Economic
entities such as corporation ,universities ,cooper
active societies,..etc
1-ali”saccount(A/C)
2- customers of credit sales(debtors )
3- suppliers of credit purchases (creditors)
(2) Real
accounts :-are the assets”accounts either
tangible or intangible assets
EXAMPLES :- cash , building ,……
(3) NOMINAL accounts :-are the accounts of revenues,
gains ,expenses ,losses .
EXAMPLES :1- SALES (A/C)
2- PURCHASES (A/C)
UTILITIES (A/C) --------------RENT-------