|Prof. Vinod Kumar|
My answer on this debate is that both are important. Every company should have both accounting and economics (finance) department.
With accounting, we can know the amount of profit and amount of our assets and liabilities. Other side, with economics, we can know to use of our fund. How to use our fund or money? It tells use the way of use of fund. But how? Fund should be used with effective ways. So that our wants should satisfy. Suppose we have one want ( for the consumption of food), second want (for wearing clothes), third want ( for living in own home) and like this, we may have 1,00,000 wants. We have to satisfy all these wants with our limited money. Accounting shows use the amount of profit or loss,amount of our assets and our liabilities. There is big relationship between accounting and economics. I starts from accounting.
Suppose, your accounting statement shows your net profit $ 100000 and you have invested $ 10,00,000. Your accounting is showing that your return on investment is just 10%. Why is this 10%? Because you had used the money of investment in any project and only economics tells you in which project, you have to use your fund. If you know economics and learned the effective use of fund. At that time, you can achieved your profit $200,000 on the same investment of $10,00,000.That will be the 20% return on your same investment. So, it is very necessary to understand the rules and regulations of economics.
Every country can classify on the basis of its economy. It has its own GDP. After seeing the GDP of any country, we can estimate the progress of that country. So, we should have to learn the rules of economics. On the other side, if we do not find, how much have we obtained profit. Is it $ 1,00,000 or $ 2,00,000? How can we use this profit for increasing next year profit. It means without accounting, economics is also useless. So, accounting is also very necessary for every company. If we do not maintain accounts, we can not find the amount of our investment and our profit. We can show total investment of $ 10,00,000, if we have maintain our accounts which is showing that our total investment is $ 10,00,000 which we have invested in different projects. Only after this, we can take different decisions on the basis of economics rules.
Modern economics has now converted in finance. Now, I think, you need not to do comparison between accounting and economics for knowing which is better. You should have to study both accounting and economics.
If you want to get one degree out of accounting and economics. Your choice should not be based on the comparison but it is based on your interest. If you are interested to maintain the records of company, you can choose accounting degree and if you want to take your innovative decisions for using company's limited resources you can choose either economics or finance degree.
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