ACCOUNTING PROCEDURES IN PARTNERSHIP BUSINESS

0
15

ACCOUNTING PROCEDURES IN PARTNERSHIP BUSINESS

 

CHAPTER ONE

INTRODUCTION

1.1   ORIGIN OF ACCOUNTING

In the prehistoric times when man as individual unit, he lived alone, and produce all that he wanted.  His only needs were food, shelter and clothing which he provided by himself. He had no business to transact with anybody or keeping record.

When man began to depend on others as a result of the division of labour which heeds man to specialization on a particular occupation and field of production and exchanges his surplus for what he does not produce out needed.  Still, man could not take or keep any record of what he exchanged.  In the sense that man has no idea of record keeping or documentation and the system of exchange was known as “Barter” which is the exchange of goods for other goods.  There is no specific measurement that can be taken so no record can be kept.  It was so cumbersome that man has to device another means for exchange in the form of commodity money such as cowries, copper wire, brassards etc. but records were not kept because they had no knowledge of such.

The first system of record keeping started at about 3,500 B. C. during the Babylonian era, when records were kept on clays or stones.  As commercial activities continued to grow, the keeping of records, data and information improved.

In place of clays/stones, they make use of the following:

(a)         Magnetic Tape

(b)        Compact Disc

(c)         Magnetic Disc

As at that time, individual firms or organizations still went on transacting business without absolute records in their day to day business.  Some did not even care to know the cost of goods they had on stock or purchased.

According to Adam, the growth in specialization as a result of the division of labour in man improved the system of exchange.  In the course of commerce growth, men have to alleviate the use of commodity money which was not convenient enough for the use of the British pound and shilling as a universal accepted money.

As soon as the Ancient Empires and States (Rome and Egypt) started world wide as a means of providing checks and balances in commercial activities with the advent of the colonial business in Africa the European system of accounting was introduced into writing of business transactions and the compilation of purchases and sales, income and expenditure of the business in such a way that the business position could be ascertained at any time.  The system of record keeping is what is known as accounting.

1.2   BACKGROUND OF THE STUDY

Accounting is said to be the language of business.  It is used in the business world to describe the transactions entered into by all kinds of organizations.  Accounting terms concepts and conventions are therefore used by people associated with business, be they manager, stock brokers, owners, investors, bankers, lawyers, estate agents, or accountants.  As it is, the business language there are words and terms that could mean one thing in accounting by meaning different thing in ordinary language usage.

DOWNLOAD COMPLETE PROJECT MATERIAL

ACCOUNTING PROCEDURES IN PARTNERSHIP BUSINESS

Leave a Reply