Business transaction: types, accounts, accounts

As objects in accounting are economic transactions. They are elements of the processes occurring at the enterprise, or facts of the economic life of the company. Economic, accounting operations affect the financial position of the firm.

Definition

A business transaction is a separate action, as a result of which the volume, composition, use and placement of funds and their sources varies. From the economic point of view, there are 2 addresses. Changes in one object provoke an adjustment in the other by the same amount. A business transaction is an event or action that leads to a statement of funds and sources available to the enterprise.

Specificity

Economic transactions on the balance affect assets, that is, the property of the enterprise. They can relate to the sources of its formation (passive). There are such events that affect both parts of the reporting. The facts of economic life constantly affect the currency of the balance sheet. This, in turn, leads to adjustments in the value of articles and assets, and liabilities.

Classification

There are the following types of business operations:

• + AA. This category of events changes the composition of the property, that is, only the asset. In this case, the balance currency is not adjusted.
• + PP. These operations affect the sources of the formation of material values of the company. They affect only the passive. In this case , the balance currency also remains unchanged.

• + A + P. This category of events affects both the size of the property and the sources of its formation. Correction is carried out in the direction of increase. The currency of the balance sheet on the passive and the asset increases by the same amount.
• -A-P. These operations also affect the property and sources of its occurrence. But the changes are in the direction of decrease.

Accounting for business transactions

Every fact of economic life must be determined in time, evaluated. In accordance with this, the accounts of business transactions are filled. The determination of the fact in time is determined by the need to establish the moment of registration. The dates reflect:

• Transfer of ownership of products, works, services provided.
• Receiving loans and loans.
• The procedure for recognizing expenses and revenues from ordinary and other activities, reflecting them for relevant periods in the documents.
• Performing settlements in foreign currency, etc.

Evaluation

Each business transaction must have its own cost at the time of the transaction. The enterprise compulsorily assesses the property to reflect it in documents in monetary terms. In accordance with the current accounting principles, all liabilities, assets, equity, expenses, income must be reflected in the corresponding amount.

Material values purchased for a fee are estimated by summing up actual purchase costs. Gratuitously received property is taken at the market price that was in effect at the date of posting. Material values created at the enterprise are valued at cost of manufacture.

Features of reflection

The executed economic operation is made out on a paper or electronic carrier. Through these documents, the primary registration of events takes place. The design is done in the order in which the operations were performed. This order allows:

• To conduct continuous, continuous accounting of objects.
• Justify the records, which are made in accordance with documents that have evidentiary power.
• Use reporting for operational management and ongoing monitoring of the enterprise.

In addition, financial discipline at the enterprise is ensured, since the primary documentation acts as the main source of information for further supervision of the appropriateness, accuracy, legitimacy of each operation.

Double entry

Formation of the information connection of synthetic accounts arising in the process of registering the facts of the company's economic activity in the nomenclature of the plan is called correspondence. It should be said that it reflects the legal relations between the subjects. Correspondence can be systematic or chronological. The facts of economic activity are reflected on the accounts by the principle (rule) of a double entry. Its essence lies in the fact that any event is registered twice. The information is reflected in the debit and credit of the account. Such a record has a control value.

The aggregate of debit turnover on synthetic accounts for the month should equal the amount of credit. If the values do not match, then there was an error in reflecting the events. In accordance with the principle of double entry, the information link that occurs between accounting objects can be shown in different ways. For example, a formula image reflects the name of the corresponding accounts. The numeric value of the record is indicated. The reflection of the corresponding accounts in the primary documentation is called the account assignment.

Key tasks of a specialist

As part of their practice, the accountant needs to solve three issues. They consist in the definition:

• The moment in which the economic operation was carried out.
• The cost expression of an event.
• The method of classification of the operation according to the nomenclature of the chart of accounts.

This is followed by three key tasks, the solution of which will allow the proper formation of documentary reporting:

• Identification of the fact of economic activity in time.
• Evaluation of the event.
• Classification of operation by nomenclature.

Conclusion

Accounting, like any other discipline, has its own subject, objects of observation, methods specific for it, and methods for registering, collecting, generalizing, accumulating data and transferring them to users. From the competent use of existing tools will depend on the completeness and reliability of reporting. This, in turn, will enable interested parties to get a timely view of the financial position of the firm.

Reporting is necessary for both external and internal users. The first include investors, creditors, counterparties. Internal users are the participants, employees of the management apparatus. Reporting allows you to identify the direction of spending, the reasonableness of costs, loss-making areas of the enterprise. Based on the results of information analysis, important management decisions are made.