Livestock Economics, Marketing and Business Management

BRANCHES OF ACCOUNTING

• Accounting has three main branches, viz.,
  • financial accounting.
  • cost accounting.
  •  management accounting.

Financial Accounting

• Financial accounting is primarily concerned with record-keeping directed towards the preparation of profit and loss account and balance sheet.
• The main purposes of financial accounting are
  • Recording of the transactions concerning and affecting the business
  • Preparation of necessary accounts and balance sheet as required by statutes and
  • Apprising the owners of the business about the results of the business over a period of time.

Cost Accounting

• Cost accounting is the process of accounting for costs.
• It is a systematic procedure for determining the unit cost of output produced or services rendered.
• The primary functions of cost accounting are to ascertain the cost of a product and to help the management in the control of cost.
• Both financial accounting and cost accounting are concerned with the accumulation and presentation of information to serve the needs of management.

Management Accounting

• Management accounting is the term used to describe the accounting methods, systems and techniques which, coupled with special knowledge and ability, assist management in its task of maximizing profit or minimizing losses.
• Hence, it is the reproduction of final accounts in such a way as will enable the management to take decisions and to control activities.