Accounts Notes: What are the types of Accounts

Wednesday 27 April 2011

What are the types of Accounts

If you ask one question from me what the total area of accounting is, then my answer is that accounting area is so wide. We can not make boundary on the four sides of accounting because this is developing science we can not bound it in few limits. It is 100% true that area of accounting is increasing day by day. Few day earlier, When I alert me the information for my GMail account with the help of Google alert . I had written Accounting, I felt happy when I found so many email from Google alert about accounting information is daily publishing in 10 millions blogs and websites. It means day by day accounting area is spreading. This is very good news for all who want to make career in the field of accounting. But today I am telling you the starting pin points of accounting, there is no end point and never will become any end point of accounting.

○ Financial Accounting

Financial accounting is relating to record all financial activity. These activities are related to business. Because of area of business is increasing day by day so the area of financial accounting is also increasing. Every day a new type of business is started. So daily accountant invents a new journal entry. Accountant will take the help of financial accounting with new thinking of result. So a new chapter of financial accounting is included by us.
○ Cost Accounting

If you want to increase your profit, then start to decrease your cost. What a dialogue, this is not a dialogue but this is the reality of today business. Every day an accountant invents new method of decreasing the cost. All method of calculation of FIFO , LIFO , standard costing , variance calculation and making of cost budget is not the end of cost accounting but this is the starting of cost accounting . Internet cost reduction method is also a new mile stone in this direction.

○ Management Accounting

One new manager will do work in the field of management accounting. He will utilize accounting information in new way . This is the real definition of management accounting. How to use accounting data and accounting education in the field of management so that we will carry our business at international level. Ratio analysis , fund flow statements, cash flow statements , working capital management , capital budgeting , cost of capital calculation is just starting in this point .