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Financial accounting
By professor shabbier Ahmed sheikh

First lecture

Always in life you remember that

readers are leaders ;

Forms of business organization

1. Sole proprietorship.
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2. PARTNERSHIP.

3. Corporation.
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Financial Accounting is language of business.

Financial Accounting is the ear and eyes of
business.
Financial accounting is consisting of service,
manufacturing, and merchandise sector.
The act of 1984 and 1932 are registered the
financial data.
The forms of business organization are
differentiating by 1. Capitalization 2. Legal
formalities 3. Management.
Corporation form is also called legal business
entity.
Auditing mean examination of data.
Accounting means preparation of financial
statement.
Financial accounting provides raw data.
Some abbreviations.
1. CPA= certified public accounted
2. SECP= security exchange commission of
Pakistan.
3. IPO= initial public operate
4. PSE= Pakistan stock exchange
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Financing. 1. Equity= owner investment (cost is

divided).
2. Debt = loan from banks (cost is
interest).
MARKET= 1. Primary = BY shares

2. Secondary= PSE
AGM= Annual general meeting.

SECOND LECTURE=24-08-17
Definition of financial Accounting
Financial accounting is a systematic way of
recording, classifying, analyzing, and
interpreting the day to day business
transaction of financial nature.
Transaction= occurrence of events

,=mean double comma, as following , is

continuous.
F.A= one event included accepted
statement universally accepted.
Systematic= Acc. To procedure
Financial statements are two statements.
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1. Income statement = profit and loss

2. Balance sheet = for decision making

WHEN. 1. Recording = day to day

2. Classifying = day to day
3. Summarizing = acc. Period
4. Analyzing and interpretation= acc. Period

ACCONTING CYCLE
Steps. 1. Recording the book = general journal
2. classifying = general ledger
3. summarizing= trail balance
4. adjusting entry= i.e depreciations
5. adjusted trail balance
6. income statement = profit and loss
7 . balance sheet
8. closing entries
Entry is soul of financial accounting
Adjusting is heart of financial accounting
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