0Accounting operates within a broad socio-economic environment, and so, the knowledge required of the accountant cannot be sharply compartmentalized. It is therefore, difficult to discuss one area without relating to other areas of knowledge. We place a great emphasis on the conceptual knowledge. The accountant should not only know but he should understand.
Objectives of Accounting:
The broad objects of Accounting may be briefly stated follows:
1.To maintain the cash accounts through the Cash Book and to find out the Cash balance on any particular day.
2.To maintain various other Journals for recording day-to –day non –cash transactions.
3.To maintain various Ledger Accounts to find out the exact amounts of incomes and expenses or gain and losses or receivables and payables.
4.To furnish information regarding Purchases and Sales, both Cash and Credit.
5.To find out the net profit or net loss or surplus or deficit for any particular period.
6.To find out the total capital on a particular date.
7.To find out the positions of assets on a particular date.
8.To find out the position of liabilities on a particular date.
9.To detect any defalcations and to check the frauds and misappropriations of money.
10.To detect the various errors and to rectify those through entries in the journal proper.
11.To confirm about the arithmetical accuracy of the books of accounts.
12.To help the management by supplying accounting ratios, reports and relevant data.
13.To calculate the cost of productions.
14.To help the management formulate policies for controlling cost, preparation of quotation for competitive supply etc.
