FINANCIAL ACCOUNT 101

                                    SUBSIDIARY BOOKS CONTD.

Hey Guys Welcome, hope you tried out what we learnt on your own? The key to being the best is practice, so practice as much as you can. Today we are going to continue from where we stopped Yesterday.

                    RETURNS INWARD JOURNAL.

It is otherwise called SALES RETURN JOURNAL, and is used to record goods previously sold but later returned to the supplier or seller by the customer, for wrong color, wrong type, inferior quality or breakage. In the Ledger the Returns inwards account is debited, while the customer’s account is credited. I t looks like this.

Date	Particulars	F	Details	Total

                     RETURNS OUTWARD JOURNAL.

It is otherwise called PURCHASES RETURN JOURNAL, and is used to record goods returned to the supplier by a seller as a result of one reason or the other, like damages to the goods etc. In the

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COMMERCE 101

                                     PRODUCTION.

Hey  Guys, Today is a new day. We are going to learn something new. We are focusing on the above mentioned topic today, so sit back, relax and learn something today.

PRODUCTION.

Production is any activity engaged in to create goods and services, and to distribute these goods and services till it reaches the final consumer. In order words, It is making of goods and services available to the consumers who are willing to pay for them in order to satisfy human wants. It is also the creation of utility.

STAGES OF PRODUCTION.

There are three stages of production and they include:

1.      PRIMARY STAGE OF PRODUCTION- It is a process of obtaining raw materials/resources from the Land, Sea or River. It is also called EXTRACTIVE STAGE. This mostly involves agricultural produce or Petroleum produce, for example Farming, Fishing, Mining etc.

2.      SECONDARY STAGE OF PRODUCTION- It is the process of turning these raw materials into finished goods by way of Manufacturing. For example, the process Tomato Fruit undergoes in the factory to become Paste that is put in tin as Tin Tomato etc.

3.      TERTIARY STAGE OF PRODUCTION- It is the distribution of finished goods and services to the consumers. The people involved in this are:

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FINANCIAL ACCOUNT 101

THE ACCOUNTING EQUATION & INTRODUCTION TO THE BOOKS OF ACCOUNT.

Hey Guys, Happy Eid-El-Kabir Celebration. Today is a new day and we are going to have fun on the above mentioned Topics.

THE ACCOUNTING EQUATION.

The Accounting Equation is the Fundamental Equation of the entire financial account. In order words, it the beginning of all equations in account as a whole, the Foundation.

1.     Assets are properties of a business. They are things owned by a business and are expected to be of Future Benefit. For example, Motor Van, Furniture & Fitting, Stock etc.

2.     Capital is the Total amount invested by the owner of a business. It is the Net Worth of a business.

3.     Liabilities are amounts of money owed by a business to outsiders. For example, Bank Overdraft, Creditors etc.

Therefore, the account equation is:

Assets= Capital + Liabilities

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