Tag: elements of book keeping and accountancy

Questions Related to elements of book keeping and accountancy

Posting refers to the process of transferring information from _________.

elements of book keeping and accountancy ledger and posting distinction between subsidiary books and ledger explain the meaning of ledger posting methods of posting entries

  1. journal to ledger accounts

  2. general ledger accounts to journals

  3. source documents to journals

  4. journals to source documents

Show answer
Correct Option: A
Explanation:

Posting is the process of transferring the entries from the book of original entry (journal) to the ledger. In other words, posting means grouping of all the transactions in respect to a particular account at one place for meaningful conclusion and for further accounting process. Posting from the journal is done periodically, may be, weekly or fortnightly or monthly as per the requirements and convenience of the business.

The following relate to the recording process. Which of these statements is correct_________.

elements of book keeping and accountancy ledger and posting distinction between subsidiary books and ledger explain the meaning of ledger posting methods of posting entries

  1. The general ledger is a chronological record, of transactions.

  2. The general ledger is posted from transactions recorded in the general journal.

  3. The trial balance provides the primary source document for recording transactions into the general journal

  4. Transposition is the transfer of information from the general journal to the general ledger.

Show answer
Correct Option: B
Explanation:

After the transactions are recorded in these journals, a summary of all the transactions is posted in each journal to the general ledger, which contains all of a company's accounts. An account is a separate, detailed record associated with a specific asset, liability, equity, revenue, or expense item.

The process of transferring the transactions relating to changes in a particular item at one place in the form of an account is called _________.

elements of book keeping and accountancy ledger and posting distinction between subsidiary books and ledger explain the meaning of ledger posting methods of posting entries

  1. Journalising

  2. Balancing

  3. Posting

  4. Casting.

Show answer
Correct Option: C

Trading and Profit and Loss Account cannot be prepared from books maintained on single entry basis because :

elements of book keeping and accountancy accounting from incomplete records preparation of final accounts from incomplete records preparation of statement of affairs ascertaining profit or loss from incomplete records introduction to single entry system and difference between single entry and double entry system

  1. Nominal accounts are not maintained in the ledger.

  2. Real accounts are not maintained in the ledger.

  3. Personal accounts are not maintained in the ledger.

  4. All of the above

Show answer
Correct Option: A

Difference between the opening and closing capital after adjusting drwaings and capitals introduced during the year is profit for the year.

elements of book keeping and accountancy accounting from incomplete records preparation of final accounts from incomplete records preparation of statement of affairs ascertaining profit or loss from incomplete records introduction to single entry system and difference between single entry and double entry system

  1. True

  2. False

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Correct Option: A

Profit, under Single Entry System is ascertained ____________ .

elements of book keeping and accountancy accounting from incomplete records preparation of final accounts from incomplete records preparation of statement of affairs ascertaining profit or loss from incomplete records introduction to single entry system and difference between single entry and double entry system

  1. by preparing Profit and Loss Account.

  2. by preparing Statement of Affairs

  3. by preparing Cash Account

  4. all of the above

Show answer
Correct Option: B

A statement of affairs is a summarised statement of an estimated _____________.

elements of book keeping and accountancy accounting from incomplete records preparation of final accounts from incomplete records preparation of statement of affairs ascertaining profit or loss from incomplete records introduction to single entry system and difference between single entry and double entry system

  1. Financial position

  2. Profit

  3. Income

  4. Loss

Show answer
Correct Option: A
Explanation:

To ascertain the Capital, Statements of affairs are prepared.
Capital = Assets - Liabilities
The above equation under which statement of affairs are prepared reflects the financial position of the business.

The capital at the end of the accounting year is ascertained by preparing _______.

elements of book keeping and accountancy accounting from incomplete records preparation of final accounts from incomplete records preparation of statement of affairs ascertaining profit or loss from incomplete records introduction to single entry system and difference between single entry and double entry system

  1. Cash Account

  2. Closing statement of affairs

  3. Total debtors account

  4. Opening statement of affairs

Show answer
Correct Option: B
Explanation:

Statement of Affairs is Based under Accounting Equation " Assets = Capital + Liabilities"
thus to ascertain the Closing Capital at the end of the year  Closing Liabilities are deducted from closing assets.

The difference between assets and liabilities is called as ___________.

elements of book keeping and accountancy accounting from incomplete records preparation of final accounts from incomplete records preparation of statement of affairs ascertaining profit or loss from incomplete records introduction to single entry system and difference between single entry and double entry system

  1. Capital

  2. Drawings

  3. Incomes

  4. Expenses

Show answer
Correct Option: A
Explanation:

As assets represents the total funds applied in the business from capital (owners fund) and liabilities(external funds e.g bank loan, creditors etc).
therefore the difference between Assets and Liabilities will represent Capital.

Find the total assets at the end of the year if net profit, drawing during the year and assets at the of beginning of the year were 12,000, 7000 and 20,000 respectively. 

elements of book keeping and accountancy accounting from incomplete records preparation of final accounts from incomplete records preparation of statement of affairs ascertaining profit or loss from incomplete records introduction to single entry system and difference between single entry and double entry system

  1. 25,000

  2. 15,000

  3. 9,000

  4. 8,000

Show answer
Correct Option: A
Explanation:

Calculation of total assets at the end of the year :- 

 Assets in the beginning of the year =Rs 20000
Less : Drawing made during the year (7000)
Add : Net profit for the year                  12000
                                                            = Rs 25000