Quick Answer: What Are The 2 Types Of Accounting?

What are the two types of accounting periods?

There are two kinds of accounting periods:Calendar Year – the accounting period begins on January 1 and ends on December 31 of the same year.Fiscal Year – the accounting period begins on the first day of any month other than January..

What are the 3 golden rules of accounting?

Debit the receiver and credit the giver. The rule of debiting the receiver and crediting the giver comes into play with personal accounts. … Debit what comes in and credit what goes out. For real accounts, use the second golden rule. … Debit expenses and losses, credit income and gains.

Is cash a real account?

Most of the real accounts show up on a company’s balance sheet. … Cash, accounts receivable, accounts payable, notes payable and owner’s equity are all real accounts that are found on the balance sheet.

What is a 12 month accounting period called?

An accounting period is the span of time covered by a set of financial statements. … If the accounting period is for a twelve month period ending on a date other than December 31, then the accounting period is called a fiscal year, as opposed to a calendar year.

What is the real account?

A real account is a general ledger account that does not close at the end of the accounting year. In other words, the balances in the real accounts are carried over to become the beginning balances of the next accounting period. Real accounts are also referred to as permanent accounts.

What GAAP means?

Generally accepted accounting principlesGenerally accepted accounting principles, or GAAP, are a set of rules that encompass the details, complexities, and legalities of business and corporate accounting. The Financial Accounting Standards Board (FASB) uses GAAP as the foundation for its comprehensive set of approved accounting methods and practices.

What are the two types of accounts?

3 Different types of accounts in accounting are Real, Personal and Nominal Account.

What are the 5 types of accounts?

The 5 core types of accounts in accountingAssets.Expenses.Liabilities.Equity.Income or revenue.

What are the 4 functions of accounting?

Stewardship functions of accounting are;Recording of financial transactions.Classifying.Summarizing.Finding net results.Exhibiting financial affairs.Analyzing financial data.Communicating financial information.

What is the types of accounting?

The famous branches or types of accounting include: financial accounting, managerial accounting, cost accounting, auditing, taxation, AIS, fiduciary, and forensic accounting.

Why is 1st April financial year?

Under the old Julian calendar, April 1st coincided with the Hindi festival of Vaisakha i.e. Hindi new year, so the East India Company in Bengal decided to synchronise it’s financial year with the Hindi calendar to ease financial transactions.

How long is the basic accounting period?

12 monthsIt is the period for which books are balanced and the financial statements are prepared. Generally, the accounting period consists of 12 months. However the beginning of the accounting period differs according to the jurisdiction.

What are the 5 basic accounting principles?

What are the 5 basic principles of accounting?Revenue Recognition Principle. When you are recording information about your business, you need to consider the revenue recognition principle. … Cost Principle. … Matching Principle. … Full Disclosure Principle. … Objectivity Principle.

What are the 4 types of accounting?

Though different professional accounting sources may divide accounting careers into different categories, the four types listed here reflect the accounting roles commonly available throughout the profession. These four branches include corporate, public, government, and forensic accounting.