Understand The Difference Between Accounting And Bookkeeping

June 17th, 2006 Comments off
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ACCOUNTING:

Accounting is a four stage process of recording, classifying, summarizing and the interpretation of the financial statements.

The four stage process are defined below:

Recording- transactions being recorded in the books of the business

Classifying- sorting and categorizing into meaningful and orderly types or manners

Summarizing- the accounting data are summarized

Interpreting- financial data are analyzed and used to assist decision making

BOOKKEEPING:

Bookkeeping is a part of Accounting. It is merely a mechanical aspect of recording, classifying and summarizing transaction.

Therefore, keeping the books of accounts is always the theme in bookkeeping. The finer aspect of interpreting all these data into information for management to act upon is excluded.

{ click here to go to Content Page on Introduction to Accounting }

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Financial Accounting

 
 

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