basic accounting

Jun 21st, 2015
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Meaning of Accounting: According to American Accounting Association Accounting is “the process of identifying, measuring and communicating information to permit judgment and decisions by the users of accounts”.

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CHAPTER IINTRODUCTION1.1 INDUSTRY PROFILEInvestment is a commitment of funds made in the expectation of some positive return. If the investment is properly undertaken, the returns will match with the risk the investor assumes. Investment goals vary from person to person, business to business. While some want security, others give more weightage to returns alone.There are various types of investments such as real estate, stocks and shares, bonds and debentures, mutual funds, fixed deposits, insurance, national saving certificate etc. As far as the returns are high the risk involved is also more. A concept, which balances the risk and returns, is mutual funds.MUTUAL FUNDSA mutual fund is nothing more than a collection of stocks and/or bonds. One can think of a mutual fund as a company that brings together a group of people and invests their money in stocks, bonds, and other securities. Each investor owns shares, which represent a portion of the holdings of the fund.The flow chart below describes broadly the working of a mutual fund: The investor can make money from a mutual fund in three ways:1) Income is earned from dividends on stocks and interest on bonds. A Mutual Fund pays out nearly all income it receives over the year to Mutual Fund owners in the form of a distribution.2) If the Mutual Fund sells securities that have increased in price, the Mutual Fund has a capital gain. Most Mutual funds also pass on these gains to investors in a dis

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