Accounting is a dynamic and an applied subject.
Even though it is an independent study, it has a relationship with other subjects.
The subjects with its relations are discussed below;
Economics is the father of Accounting; so, the relation of Economics with Accounting is very close.
Economics is a science related human activities to fulfill demand with limited wealth.
Economics analyzes how people earn and spend; how buyers and sellers behave under different circumstances etc.
Economics studies the behaviors of buyers and sellers as a whole.
Accounting records financial transactions of income and expenditure measurable in money; it provides necessary and relevant information to its users for taking economic decisions.
Therefore, Accounting and Economics are interrelated.
In this perspective and fusion between the concept of economics and accounting, the concept of social sciences is being applied.
Accounting and Management are closely related.
Management depends entirely on accounting for financial information to make financial decisions; they cannot take the best and most dynamic action without financial statements.
Accounting provides all kinds of financial information to the management for planning and implementation of a business concern.
As a result, management can take decisions easily regarding project planning and implementation.
Nowadays, overall development of trading, non-trading, government, semi-government, autonomous bodies etc depends on management.
In the modem age the responsibilities of making decisions and planning have been shifted from owners to professional-managerial persons.
Therefore, the success of management fully depends on accounting information.
Click on link for YouTube videos topic wise :
Basic Journal Entries in Nepali
Basic Journal Entries
Journal Entry and Ledger
Trial Balance and Adjusted Trial Balance
Bank Reconciliation Statement (BRS)
Click on link for YouTube videos chapter wise:
Financial Accounting and Analysis (All videos)
Accounting for Long Lived Assets
Analysis of Financial Statement
Luca Pacioli is known as father of accounting; he wrote the first published accounting work in 1494 AD.
Eugene F. Fama is known as father of modern finance.
He is the most cited researchers in economics.
His research is well known in both the academic and investment sectors.
Finance was the part of economics till beginning of 19th century.
At the beginning of 19th century, finance came out as separate subject or field.
In this way, accountancy is older than finance for study.
We study theoretical as well as practical knowledge in both accountancy and finance.
The main work of accountancy is to record monetary transactions.
These transactions are recorded in financial statements like journal entries, ledger, trial balance, income statement and balance sheet etc.
Finance examines and analyses these financial statements to take rational financial decisions.
Thus, Accountancy and Finance are interrelated.
Accounting and Mathematics are closely related.
Accounting is the language of business and mathematics is the language of Accounting.
At different stages of accounting arithmetic are applied like addition, subtraction, multiplication, division, percentage, average and so on.
Accounting expresses all its financial transactions and events of financial changes in the language of mathematics i.e. in preparing journal, ledger, trial balance, financial statements, ratio etc.
Therefore, mathematics is an essential part of accounting.
There is a close relationship between Accounting and Computer Science in modern day.
The word computer has been derived from the word compute that means counting and calculation.
It is possible to solve mathematical problems involving millions or billions of figures within a few seconds with the help of computer.
Accounting is complex subject and takes huge time and labour for accuracy of accounting; the computer has eliminated all these obstacles.
In manual accounting, human does all accounting entries like journal entries, ledgers, trial balance, income statement, balance sheet, cash flow statement, ratio analysis etc.
But, in computer accounting, just create leader account and fill the accounting information; then computer does entire accounting work automatically; it saves time and labour.
Besides this, preparation of various accounts as per need, preservation and verification of the validity are possible very quickly with the help of a computer.
In the modem world, the application of computers is growing fast to solving accounting problems; in our country also the application of computers is increasing in the field of accounting problems.
Therefore, the relation between Accounting and Computer is very close in modern day.
The main purpose of statistics is to collect primary or secondary data then classify and analyze these quantitative data to present various events for individuals or organizations concerned.
On the other hand, in Accounting after completing some accounting processes, final accounts and financial statements are prepared.
In accounting we use some statistics formulas like average and weighted average.
Many accounting figures are presented in statistics such increase or decrease of sales, gross profit, net profit etc on various bar graph and diagram, pie chart.
Users of accounting and statistics use data from these two subjects to make arithmetical figures understandable and logical presentation.
Therefore, Accounting and Statistics are closely related.
In simple term we think law means diwani (civil court) and faujdari (criminal court); but there is other law also i.e. corporate law or company law.
There are lots of civil court cases related to accounting and taxation.
The accountant must have a clear knowledge of partnership law, company law, tax law, industrial law, cooperative law and other relevant laws.
For example, accounts of every Joint Stock Company are kept properly and accurately according to company law.
In partnership business, accounts are maintained according to partnership act or agreement of partners.
In financial accounting, accounts are maintained to fulfill requirement of company law and taxation law.
In this context, lawyers are to know the provision of laws related to methods of accounting, direction and controlling.
Otherwise, it is impossible in settling conflicts and cases properly.
Therefore, Accounting and Law are closely related subjects.
The main objectives of political science are freedom, equality, individuality, democracy and justice to the citizen of the nation.
Other objective of Political Science is to ensure law and order for establishing rule of law in society.
To ensure above mentioned points, the gross domestic products (GDP), per capita income (PCI) must be best.
State or central government charges different kinds of taxes like income tax, sales tax, VAT, GST etc.
These taxes are the main sources of the government revenue.
From these revenues, government makes expenditures on public constructions, education, health, defense etc.
Keeping proper accounts of these incomes and expenditure, accounting is necessary.
Without maintaining accounting, government cannot make budget.
Therefore, there is close relationship between Accounting and Political Science.
In manufacturing process, company uses different plants and machineries for production (convert raw materials to finished goods).
Sometime company uses special machine and equipment.
To operate special machine, skilled manpower is needed.
Some spare parts of these machineries may be costly.
These plants and machines are operated and handled by the engineering department; and engineers are engaged in engineering work.
The estimation regarding types of goods, quantity of goods, production cost, labour engaged on machinery, depreciation on machinery etc are to be recorded in accounting.
For this reason, the entrepreneurs, directors, production managers should know about engineering.
The accounting function of an accountant is to find out money invested in plant and machinery.
Accountant should find out production cost of plant and machinery, machinery turnover ratio, depreciation on plant and machinery etc.
Without the knowledge of engineering, an accountant cannot provide accurate accounting information regarding plant and machinery
In this reason, there is close relationship between Accounting and Engineering.
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