Branches Of Accounting

Branches Of Accounting

In order to meet the ever increasing demands made on accounting by different interested parties (such as owners, management, creditors, taxation etc.) the various branches of accounting have come to existence:

1.Financial Accounting

2.Cost Accounting

3.Management Accounting

Now the explanation is given blow:

Financial Accounting:

 The  main purpose of financial accounting is to ascertain the true result (profit and loss) of the business operations during a particular period of time and to state the financial position of the business on a particular point of time. Financial accounting produces general purpose reports for use by the great variety of people who are interested in the organization but who are not actively engaged inits day-to-day operation.

Cost Accounting:

The main object of cost accounting is to determine the cost of manufactured or produced by the business. It also helps the management of the business in controlling the cost by indicating avoidable losses and wastes.

Management Accounting:

The main object of this accounting is to communicate the relevant information periodically to the management of the business to enable it to take suitable decisions