Mahajani system of accounting is an ancient. Indian method and one of the oldest systems of the world. Like method of modern ledger, in this double entry is made of each transaction.
1. At the initial stage detail entry is made date wise for memory.
2. Secondly, by dividing the accounts serial wise entry is made, which is called posting.
3. Like modern ledger method, three types of accounts are made in this –
1. Personal account
2. Material cost accounts, and
3. Profit/Loss accounts. Also, to know profit/loss and financial status, final accounts are made.
4. By preparing trial balance, mathematical accuracy can be checked of accounts. If wrong amount is entered, it would be rectified.
5. Like modern ledger, rules of deposition are same in it. Hence, it is clear that Mahajani system of accounting is a completely scientific method.
