A set of programs that enables a computer to perform its tasks or commands given by the user. There are the following six types of software.
Types of Software
Operating System: It is an integrated set of specialized programs that are meant to manage and control the resources of a computer. They make the computer user–interactive, i.e. user-friendly. It means that the operating system forms an interactive link between the user and the computer hardware. For example, Windows, Linux, etc.
Utility Programs: Utility Programs refer to a set of pre-written computer programs that are designed to perform certain supporting operations. Most of the utility software is highly specialized and is specially designed to perform a single task or a small range of tasks. For example, virus scanners, system profilers, etc.
Application Software: These are user-oriented programs that are designed and developed for performing certain specified tasks. For example, Microsoft Word, Flash Player, Skype, etc.
Language Processors: These are the software that interprets or translates program language into machine language. For example, COBOL Processor, Fortran Processor, etc.
System Software: These are the software that controls the internal functions of the system such as reading data from the input devices.
Connectivity Software: This is the software that creates and controls the connection between a computer and a server with the purpose of sharing the data.
Any interest paid on capital is considered as an expense and is shown in the Profit and Loss Account. Treatment of interest on capital in the final accounts is as follows.
Treatment of interest on drawings in the final accounts is as follows. Firstly, interest in drawings is shown on the credit side of the Profit and Loss Account.
Operating Profit can be defined as the profit earned by carrying the normal business activities. It is computed by subtracting the operating expenses from the gross profit.
The balance sheet is the last financial statement that is prepared by any organization. This statement helps to ascertain the true financial position of an enterprise at the end of an accounting period
A profit and Loss Account is the second financial statement prepared by an organization. This account is prepared to ascertain the net results of a firm in form of net profit earned or net loss incurred during an accounting period.
In order to incorporate adjustments in the financial statements, we pass the required Journal entries, which are termed as adjusting entries.