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Book-Keeping and Accountancy · Class 11 Commerce

Ch 1Introduction to Book-Keeping and Accountancy — Class 11 Book-Keeping and Accountancy, concept-first.

Every business, whatever its size, enters into a large number of transactions every day — buying goods, selling goods, paying rent, receiving cash from customers, paying wages to workers.

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Key concepts

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Book-Keeping, Accounting and Accountancy

Book-keeping is the routine recording-and-posting part of the work, ending at the Trial Balance. Accounting adds summarising and interpreting to book-keeping, requiring judgement.

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Chapter contents

The NCERT structure, section by section. Open a section to see its questions, then read the concept-first solution.

1

Meaning of Book-Keeping, Accounting and Accountancy

Every business, whatever its size, enters into a large number of transactions every day — buying goods, selling goods, paying rent, receiving cash from customers, paying wages to workers.

2

Objectives and Importance of Book-Keeping and Accounting

Book-keeping and accounting are not maintained out of habit — every business keeps them for a set of clear, practical reasons.

3

Qualitative Characteristics of Accounting Information and the Branches of Accounting

For accounting information to actually be useful to the people who read it, it must possess certain qualities.

4

Parties Interested in Accounting Information

Accounting information is not prepared only for the owner of the business — a wide range of parties, both inside and outside the organisation, rely on it for their own purposes.

5

Systems and Bases of Book-Keeping

Once a business decides to keep accounts, it must choose (a) a system for recording transactions, and (b) a basis for deciding WHEN a transaction is recognised in the books.

6

Basic Accounting Terminology

Before moving to the actual recording of transactions in Chapter 2, a student must be comfortable with a set of basic terms that recur throughout the subject.

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Limitations of Accounting

Accounting is an indispensable tool, but a student should also be able to state its genuine limitations honestly.

Exercises

+Show 11 questions11 questions
  1. Q1Explain the meaning of Book-Keeping. State its main features.Free
  2. Q2Distinguish between Book-Keeping and Accounting.Free
  3. Q3What is Accountancy? How is it related to Book-Keeping and Accounting?Free
  4. Q4State any five objectives of Accounting.Preview
  5. Q5Distinguish between Financial Accounting, Cost Accounting and Management Accounting.Preview
  6. Q6Who are the parties interested in accounting information? Explain briefly.Preview
  7. Q7Distinguish between the Cash Basis and the Accrual (Mercantile) Basis of Accounting.Preview
  8. Q8Define the following terms: (i) Capital (ii) Drawings (iii) Debtor (iv) Creditor.Preview
  9. Q9Explain the meaning of Capital Expenditure, Revenue Expenditure, and Deferred Revenue Expenditure, with one example each.Preview
  10. Q10Classify the following items as Capital Expenditure or Revenue Expenditure: (i) Purchase of a delivery van (ii) Wages paid to factory worker…Preview
  11. Q11State, with reasons, whether each of the following is an Asset or a Liability: (i) Building owned by the business (ii) Loan taken from a ban…Preview