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Growth of accounting Knowledge

Growth of accounting Knowledge. (1950-present) 1- Later half of the current century , saw accounting as a Full-fledged information system. its not regarded as art ,but a science like other social sciences.

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Growth of accounting Knowledge

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  1. Growth of accounting Knowledge (1950-present) 1- Later half of the current century , saw accounting as a Full-fledged information system. its not regarded as art ,but a science like other social sciences. 2- Many new theoretical concepts were tested and put to practice . A long descriptive approach ,the normative approach to development of an accounting theory was also regarded as useful . 3- Various accounting standards boards and committees were set up to issue statements of concepts and standards in many countries.

  2. Growth of accounting Knowledge 4- International accounting was developed to harmonize accounting techniques and practices in member-countries. 5- Accountability accounting and human resource accounting are arise . 6- Non-monitory information also began to be reported in annual statement.

  3. Growth of accounting Knowledge 6- Now greater attention was laid to systems planning and inter-disciplinary applications. The application of computers has revolutionized accounting system and techniques .information system, information technology (IT), E-commerce, management sciences. • Accounting is now becoming a multiple model (pattern) science.

  4. Development of Accounting Practice and Theory In European Countries • European countries took the lead in developing accounting principles , practices during the past 2 centaury. • Various cost accounting , management accounting , financial accounting associations and institute came up in : 1- United Kingdom (UK). 2- Germany. 3- France. 4- Switzerland. These Countries also contributed to the development of accounting principles.

  5. Basic Accounting Equation • All transaction of a business can be referred to this basic equation : Assets = Liabilities + Owners’ Equity • To further explainthe transaction of revenues, expenses, losses , and gains, the equation can be expanded thus : Or Assets + Expenses = Liabilities + Revenue + Owners’ Equity Or Assets = Liabilities + (Revenue- Expenses) + Owners’ Equity • The equation must be in balance after every transaction. For every Debit there must be a Credit.

  6. Basic Accounting Equation • Thus , there are five categories of accounts : 1- asset account. 2- liability account. 3- revenue account. 4- expense account. 5- capital or owners’ equity account.

  7. Normal Balance Credit Normal Balance Debit

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