Notes and Summaries for Fundamentals of Accounting || 1

Accounting/Notes For Bills Of Exchange  and Promissiory Notes

A Bill of Exchange has been defined as  an  “instrument  in  writing containing an unconditional order signed  by  the  maker  directing  a certain person to pay a certain sum of money only to or to the order of a certain person or to the bearer of the instrument”. When such an order is accepted in writing on the face of the order itself, it becomes a valid bill of exchange.

Joint Venture Accounts and Methods of Accounting

A Joint Venture is a very short duration “business” (generally, confined to a single transaction, like, buying some surplus stores and selling them) entered into by two or more persons jointly. Joint Venture may be described  as  a  temporary  partnership between two or more persons without the use of the firm name, for a limited purpose.

Venture  may  be  for  the  construction  of  a building or a bridge, for the supply of certain quantity of materials or labour and even for the supply of technical services. The persons who have so agreed to undertake a Joint Venture are   known   as   ‘Joint   Venturers’   or   ‘Co- Venturers’.

Bank Reconciliation Statements

• Strictly speaking there should be no difference in Cash Book and Pass book.

• However on a particular date it is possible that balances on both the books do not tally.

• After finding the reasons for non agreement of the bank balances efforts are made to reconcile. This statement is prepared in the form of BRS.

Important Note on Consignment Accounting and Summaries

To consign means to send. In Accounting, the term “consignment account” relates to accounts dealing with a situation where one person (or firm) sends goods to another person (or firm) on the basis that the goods will be sold on behalf of and at the risk of the former...

Depreciation AS 6 Notes and Summaries

Depreciation is a measure of wearing out, consumption or other loss of value of a depreciable asset arising from use, effluxion of time or obsolescence through technology and market changes. Depreciation is allocated so as to charge a fair proportion of the depreciable amount in each accounting period during the expected useful life of the asset. Depreciation includes amortisation of ...

Accounting for Partnership Notes and Illustrations

This notes covers illustrations of following topics on partnerships.

  1. Goodwill and Method of Valuation
  2. Admission of Partners
  3. Retirement of the Partners
  4. Death of the partners