Single Entry and Double Entry Accounting

-
Single entry accounting/Cash accounting. This system records only cash movement of transactions and that too up to the extent of recording one aspect of the transactions. This means that only receipt or payment of cash is recorded and no separate record is maintained (about the source of receipt and payment) as to from whom the cash was received or to whom it was paid. Double entry book keeping/Commercial accounting. Double entry or commercial accounting system records both aspects of transaction i.e. receipt or payment and source of receipt or payment. It also records credit transactions i.e. recording of Electricity Bill or accruals of Salary payment etc. This concept will be explained in detail in the next lectures but for the time being it should be noted that in cash accounting date of receipt / payment of actual cash is important while in commercial accounting the date on which the expense is caused (whether paid or not) as well as the spreading of the cost of c
Post a Comment

ADMINISTRATIVE VIEW OF MANAGEMENT

-
The Administrative Management
It is a term used for those early-day contributors who developed and taught principles to be used by managers, both individually and collectively, to improve the performance of the overall functions of the organization.
 
Henri Fayol (1841-1925) asuccessful French industrialist, developed theories about management he thought could be taught to those individuals with administrative responsibilities.
 
a.  Fayol’s lasting contribution is the functional approach to management which isstill used today. The major managerial functions, according to Fayol, were planning, organizing, commanding, coordinating, and controlling. The functions have been slightly modified several times since Fayol. In the main, though, they still provide the basic framework for studying management as witnessed by the organization of this and most other principles of management texts used today. Like Weber, Fayol’s works were not translated into English for a couple of decades after his death.

b.  Fayol gives us 14 principles of management which are still being used nowadays. These principles are given below:

Fayol’s 14 Principles of Management

1.  Division of work
Specialization increases output by making employees more efficient.
 
2.  Authority.
Managers must be able to give order. Authority gives them this right. Along with authority, however, goes responsibility.
 
3.  Discipline.
Employees must obey and respect the rules that govern the organization.
 
4.  Unity of Command
An employee should receive orders from one superior only.
 
5.  Unity of direction.
 The organization should have a single plan of action to guide managers and workers.
 
6.  Subordination of individual interests to the general interest.
The interests of any one employee or group of employees should not take precedence over the interests of the organization as a whole.
 
7.  Remuneration.
 Workers must be paid a fair wage for their services.
 
8.  Centralization.
This term refers to the degree to which subordinates are involved in decision making.
 
9.  Scalar Chain.
 The line term refers to the degree to which subordinates are involved in decision making.
 
10. Order.
 People and materials should be in the right place at the right time.
 
11. Equity.
Managers should be kind and fair to their subordinates.
 
12. Stability of tenure of personnel
Management should provide orderly personnel planning and ensure that replacements are available to fill vacancies.
 
13. Initiative.
Employees who are allowed to originate and carry out plans will exert high levels of effort.
 
14.  Esprit de corps
Promoting team spirit will build harmony and unity within the organization.


Comments

Post a Comment

Popular posts from this blog

RECORD KEEPING AND SOME BASIC CONCEPTS

-
Image
We can maintain a diary of transactions and note the daily transactions like sale, purchase etc. in it. Problems Faced in Maintaining Diary of Transactions • How will we come to know the income and expenses from various sources? • We only have a sheet / page on which daily transactions are listed. • We do not know which product is selling better and which is not. Available Alternate One can go through all the transactions at the end of the month and note different types of transactions on different pages. So that every page gives complete detail for a different type of transaction like sales of different products and expenses of different types now try to go through these transactions and separate transactions of different types.   But what if the number of transactions is large? Is it really possible to go through hundreds or thousands of transactions at the month end and analyse them to obtain required results.  Sales and purchase are not always for cash. Some ti
Read more

Single Entry and Double Entry Accounting

-
Single entry accounting/Cash accounting. This system records only cash movement of transactions and that too up to the extent of recording one aspect of the transactions. This means that only receipt or payment of cash is recorded and no separate record is maintained (about the source of receipt and payment) as to from whom the cash was received or to whom it was paid. Double entry book keeping/Commercial accounting. Double entry or commercial accounting system records both aspects of transaction i.e. receipt or payment and source of receipt or payment. It also records credit transactions i.e. recording of Electricity Bill or accruals of Salary payment etc. This concept will be explained in detail in the next lectures but for the time being it should be noted that in cash accounting date of receipt / payment of actual cash is important while in commercial accounting the date on which the expense is caused (whether paid or not) as well as the spreading of the cost of c
Read more

Money Measurement Concept

-
In accounting, every transaction that is worth recording is recorded in terms of money. In other words any event or item that cannot be translated in terms of money is not recorded in books of accounts.   With the passage of time, the trading volumes and types of commodities available in the market are increased and it became difficult to exchange commodity with other commodity. That is why the concept of cash / money is introduced and people started valuing all goods / services in terms of a common commodity called money. Now the price of 10 kg wheat would be Rupees 60 instead of 2 meters of cloth. Similarly, the price of 2 meters of cloth and 5 litres of milk would also be Rupees 60.
Read more