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I'm Lucia and today we're going to talk about what accounting is. Accounting is the discipline that teaches about the rules and procedures for analyzing, classifying and recording the transactions carried out by an economic entity, whether an individual or an entity constituted as a company with a profit-making or non-profit economic activity. This discipline is fundamental to

preparing financial information that is useful to the user in making economic decisions. Record. In essence, accounting involves keeping track of all financial transactions that occur within an entity. This includes everything from sales, purchases, expenses, investments, and so on. Each transaction is recorded in appropriate accounts using a standardized system, usually through accounting software or ledgers.

Classify. Classifying the transactions of an economic entity refers to categorizing them into specific accounts according to their nature or type. This classification is crucial for organizing financial data accurately and preparing financial statements effectively. Example. Sales transactions generate revenue, while purchases generate costs and expenses. Investments can involve the acquisition of assets, and loans

generate liabilities. Classifying these transactions involves identifying their specific characteristics and assigning them to the appropriate accounts in the company's accounting records . Accounts are usually organized into categories such as assets, liabilities, equity, income, and expenses. By classifying transactions into these categories, accountants can track the flow of financial resources within the company and thus

accurately reflect its financial condition and financial statement performance . Analyze. After recording and classifying the transactions of an economic entity, it is important to perform the analysis, as it is an accounting process and essential for informed decision-making and strategic planning. The analysis serves to identify trends. That's right, accountants analyze transaction data over time to identify