Hey all, everybody earn a splendid amount of money..! At the same time, we run behind "Financial Managers or Planners" for investing our money to get it multiplied..! But Does a Financial Manager work magic to multiply our money..?
The problem lies within us where we are least interested in Finance & Accounting subjects, and we shed-off all the opportunities we get to learn stuffs.. So lets start from the basics of accounting terminologies and understand them better...!
What are accounts?
What is debit?
What is credit?
What is an asset?
What is a liability?
The answer is very simple and clear.
ACCOUNTS:
“An account is an individual record of a person, firm, or thing, an item of income or expenses”.
A famous accountant named KOHLER says that, “an account is a formal record of a particular type of transaction expressed in money”.
DEBIT:
The word debit is derived from a Latin word debitum which means due for that.
In brief debit can be explained as “the benefit receiving aspect of a transaction”. The abbreviation for debit is ‘Dr
CREDIT:
The word credit is derived from the Latin word creder which means due to that.
In brief credit can be explained as “the benefit giving aspect of a transaction”.
The abbreviation of credit is ‘Cr’.
ASSETS AND LIABITITY:
“Assets are something that you own” and “Liability is something that you owe”.
In other words assets are future economic benefits, the rights, which are controlled by an organization or an individual, and Liabilities are the claims of those who are not the owners.
So, lets get into hardcore finance, accounting & financial planning topics from my next article, which will enlighten everybody to plan for your future...!
4 comments:
nice start to accounts. But to tell u the truth..these are mere definitions. A person likes me who is anonymous to this subject,will not get a clear picture of things.. So it will be more comfortable if u explain with some example for transaction,debit and credits...
you are right shankar...
it will be better if it would come up with examples...
ok i will site few examples in my next article
but these are the basic definition tat anybody can understand.... anyway will explain u better
Financial managers are most knowledgeable about these things. The basics of accounting is definitely easy. There are tutorial videos around the web that teach people, especially students, how to easily remember debit and credit. Well, if the tutorial is entertaining and creative, the viewers could easily get the basics of accounting.
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