What is Accounting:
Accounting is the science that designates the totality of the numerical records made in order to determine and order, in a complete way, all the movements, in value and in quantities, carried out within the scope of activity of a company or similar entity.
Accounting can be divided into financial and business accounting. Financial accounting comprises all payment transactions between the company and abroad (eg purchases and sales, banking operations) and allows the annual balance sheet to be made for tax and commercial purposes. Business or analytical accounting assumes the use of costing (with its corresponding cost elements, etc.).
A person whose professional area is accounting is known as an accountant. In Brazil, in order for an individual to receive the title of "Accountant", he must carry out the Examination of Sufficiency of the Federal Accounting Council.
Cost accounting is an area of business accounting that, unlike financial accounting, encompasses accounting for all internal costs and benefits, including plant accounting, material and salaries. Cost accounting is used to:
exclude outside influences on the company in determining monthly or annual income;
to control the profitability of the company, thanks to the inclusion of all types of costs and the different productions, and sometimes also with the aid of planned cost accounting;
prepare production and investment planning;
obtain the necessary data to close the commercial and fiscal year.
In the field of general ledger accounting, cost accounting may or may not be linked to financial accounting.
Public accounting refers to the systematic recording of financial transactions carried out by all public sector bodies.
Management accounting is the area of accounting through which one seeks to establish and determine the future development of a company. It has a strong strategic planning dimension. Generally the starting point is the sales plan, from which the production plan (costs), the supply plan and the financing plan are derived.
Also known as tax accounting, tax accounting is the area of application of the accounting sciences whose purpose is to establish and conciliate the generation of taxes of a certain entity. Tax accounting provides important data for the determination of taxes.
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