Golden rules of accounting

Accounting is totally based on general entry system. It is very important and useful to put right entry at right side. Therefore, Accounting has three basic rules which are also called ‘golden rules of accounting’ due to its relevance.  Accounting is almost incomplete without these rules. These rules of accounting are as follows: Debit the…


Balance sheet – Meaning and format

Balance sheet is one of the important financial statements which a joint stock company has to prepare at the end of every financial year. It is a summarized report of assets, liabilities and shareholders’s funds of a company. The balance sheet is used to access the current position of a company. It is mandatory for every…


Debt instrument – Definition and types

Definition: Debt instrument is a document by which an issuing party raises funds and promises to repay the same as per the terms of the contract. A debt instrument is basically a medium of raising ‘borrower’s capital’ by a company. It serves as an enforceable document for the lender of the fund in case of…


Difference between current assets and liquid assets

Liquid assets are thought of as current assets, but in practical the two terms are different. Yes, it would be wise to say that all liquid assets are part of current assets too. Now the question arises: What is the difference between current assets and liquid assets? The main difference between current assets and liquid…


Difference between accounting and finance

Accounting and finance both are similar in a way that both deals with monetary section of a business enterprise. In fact finance is a broader term which also covers accounting in it. Now the question arises what is the difference between accounting and finance? The two terms can be differentiated based on the below points: Firstly,…