It is the maid books of the accounting system which is a set of accounts. It contains all accounts relating to the mainly two types one is bounded ledger and another is looseteat ledger.

It is a book containing a sequential record of transaction. It record all daily transaction of a business into the order in which they occurs. Here transaction are related under the double entry system.

Cash : It is a system in which accounting entries are made only when cash is received or paid. Cash basis system means the same as money, which is immediately available. Professional people record there income while any cash  or cheque received, similarly record as expenses when actually cash  or cheque paid both are in a liquid manner.

Accrual : It is a system in which accounting entries are made only the basis of amounts having became due for payment or received. In accrual basis system  the interest or investment is the adding together for different cases over a period of time.

It is one type of statement (not an account ) which is not mandatory but we prepared it for checking the previous account (journal and Ledger) and before going to the preparation of final account.

According to this convention the accountant follows the following rules  given below –

“Anticipated no profit but provide for all possible losses”, while recording business transaction. Actually an accountant follow a policy that is “Playing Safe”.

Entity Concept is also known as Separate Concept

In accounting business is consider to be a separate entity from personal one. It is something that exists separately from other things and has a clear identity of its own. This concept extremely helpful in keeping business affairs strictly.

Going concern concept

According to this concept business has no fixed life time, means business can alive for unlimited period. Until the business going to the liquidation or any legal matter, because can continue works successfully.

Dual Aspect concept

According to this concept every valid business transactions has dual effect we find two sides or accounts of every financial transactions, one is debit and another is credit side. Actually business has two sides one is assets and another liabilities.

Cost Concept

According to this concept as assets value will be recorded which amount paid to accrue this assets. This cost is the basic for all subsequent accounting for the assets. That means the accounting for the assets.

Accounting Period Concept

This concept is related with going concern concept. According to this concept life of a business is divided into appropriate segment for studying the results in account books after is each segment. This segment A/c helps to know the business position, tax position, assets position , liabilities position and any other comparative job. This segment is mainly a financial year like 1^st April / to 31^st March.

Gross profit origins from all direct income –(-) all direct expenses where as all net profit (all gross profit + all indirect income – all indirect expenses.

Which cause changes in the financial condition of being measured in terms of money are called business transactions.

Accounting can be defined as the subject by studying which the record of all monetary transactions of an business.

Accounting is now more information system then a  mechanism for recording transaction and ascertaining the result there of.