Check sibling questions
Accounts and Finance
Step 1 Basic of Accounts - Debits and Credits

 

Accounting in Textbooks

Accounting in Companies

We do accounting manually by pen and notebook (Manual Accounting)

We do accounting on  Computers in Some software like Tally

(Computerized Accounting)

Steps

We first

1. Pass Entries

2. Make Ledgers

3. Make Trial Balance

4.  Make Profit and Loss

5. Make Balance Sheet  

Steps

We only

1.  Make Ledger Name

2.  Pass Entries

Automatically Ledgers, Trial Balance and Balance Sheet updated

We study accounts and tax separately

 

Journal Entries of Sale, purchase, expense, income do not have taxes like Vat, Service tax, TDS (Both Separate Subjects)

We do accounting for different bills having taxes like Vat, Service tax, TDS etc

 

 

There are more chances of errors

There are less chances of errors, however accounting entries should be correct

 

Summary

If we know Journal Entries for various transactions, we can easily do Proper Accounting

For that, we need to learn Debit Credit (Which account to be debited and which credited)

 

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Davneet Singh

Davneet Singh is a graduate from Indian Institute of Technology, Kanpur. He has been teaching from the past 12 years. He provides courses for Maths and Science at Teachoo.