Basic Accounting Terms | Chapter 2 | Class 11 | Accounts
Rajat Arora・2 minutes read
Accounts tell the financial story of a business through transactions impacting its financial position, involving changes in assets, liabilities, and capital. Understanding income versus profit is crucial, with income representing total revenue earned and profit being the surplus after deducting all expenses.
Insights
- Transactions in business impact the financial position and are recorded in accounts, reflecting the economic activities that change a business's assets, liabilities, and capital.
- Understanding the distinction between income and profit is crucial, where income represents total revenue earned, while profit is the surplus after deducting all expenses, with more revenue leading to profit and more expenses leading to a loss.
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Recent questions
What are assets in business?
Properties or resources providing future benefits.
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