Elements of Computer System

Computer System is an electronic machine that is used to process raw data into meaningful information required by the users. It works on a set of instructions that are programmed into it in the form of software which helps them in processing the data and producing information as per the requirement. A computer system is mainly composed of six elements namely, hardware, software, people, procedures, data, and connectivity. A detailed explanation of all these elements of a Computer System is given below.

Elements of Computer System


It includes all the physical components of a computer such as a keyboard, mouse, monitor, processor, etc. These components can be touched and the user inputs command using these components.


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.

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.


It constitutes the most important part of a computer system. It basically refers to the individuals or the users who interact with the computer through the use of hardware and software. The following are the people who are involved with a computer system.

System Analysts: They are the people who design the data processing system.

Operators: They are the people who write programs to implement the data processing system.

Programmers: They are the people who participate in operating the computers.


A series of operations that are executed in a certain manner in order to achieve the desired set of results are known as ‘Procedures’. There are mainly three types of procedures, which are as follows:

Hardware-oriented Procedures: Hardware Oriented Procedures provide details about various components of a computer and their uses.

Software-oriented Procedures: Software Oriented Procedures provide a detailed set of instructions required for using the software of a computer system.

Internal Procedures: These procedures help in sequencing the operation or working of each sub-set of the overall computer system.


The facts that are gathered and entered into a computer system are known as ‘Data’. It may comprise numbers, text, graphics, etc.


This refers to the manner in which a computer system is connected to other electronic devices through telephone lines, microwave transmission, satellite links, etc., which is known as ‘Connectivity’.

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Interest on Capital

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.

Interest on Drawings

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.

What is Operating Profit?

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.

Balance Sheet

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

Profit and Loss Account

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.

What are Adjusting Entries?

In order to incorporate adjustments in the financial statements, we pass the required Journal entries, which are termed as adjusting entries.