Which of the following are regarded as features of the single-entry system, generally maintained by small shopkeepers? (i) Maintenance of transactions related to personal accounts on the double-entry basis and maintenance of transactions related to real and nominal accounts on the single-entry basis. (ii) Maintenance of a cash book with mixed transactions. Normally, both personal and business transactions are mixed in a cash book. (iii) Form and accounting accuracy of the single-entry system differ from firm to firm.
All of (i), (ii) and (iii)
The correct answer is All of (i), (ii) and (iii).
The single-entry system is an incomplete and unscientific method of book-keeping generally maintained by small shopkeepers who cannot afford the rigour of the double-entry system. Its key features include all three statements:
(i) Personal accounts (debtors and creditors) are usually maintained on a double-entry basis, while real and nominal accounts are kept on a single-entry basis or ignored altogether.
(ii) A cash book is maintained, but it typically mixes the proprietor's personal transactions with business transactions, making it impure.
(iii) There is no uniform format or accounting accuracy; the form of records differs from firm to firm depending on the convenience and needs of the owner.
Hence, all three statements (i), (ii) and (iii) correctly describe the features of the single-entry system.
Similar Questions
Which of the following statements is correct?
Which of the following statements is correct?
Which of the following statements is INCORRECT?
______ is defined as a statement or a list of all ledger account balances taken from various ledger books on a particular date to check the arithmetical accuracy.
Accounting is rightly referred to as the '________' of business.
In relation to the ledger, which of the following statements is INCORRECT?
The main focus of _______ is on recording and classifying monetary transactions in the books of accounts and preparation of financial statements at the end of every accounting period.
Which of the following statements is INCORRECT?
In relation to the single-entry system, which of the following statements is INCORRECT?
Match the following accounting concepts with the meaning/implications.
Accounting
Concept
Meaning
Implication
(i)
Money
measurement
concept(a)
Capital of the proprietor is considered as a liability
(ii)
Business
entity concept(b)
Fixed assets are
valued on a cost basis(iii)
Going concern concept
(c)
Changes in purchasing power are ignored
Important Questions from Basics of Accounting
Assertion (A) : Personal transactions of the owners of the business are not recorded in the books.
Reasoning (R) : According to the business entity concept, each business enterprise is considered as an accounting unit separate from owners.
Match List I with List II.
List I (Accounting Concepts)
List II (Purpose/Applicability)
A.
Going Concern Concept I.
The same accounting method used by a firm from one period to another B.
Consistency II.
Relate to the relative size or importance of an item or event C.
Cost concept III.
This an inappropriate assumption for a firm undergoing bankruptcy D.
Materiality
IV.
The normal basis used to account for assets
Choose the correct answer from the options given below:A company purchased a machinery on 01-01-2015 for a sum of Rs. 60,000. The retail price index on that date was 150. What is the value of machinery according to CPP method on 31st December 2015, When the price index was 200.
Which among the following are generally accepted methods of accounting for price level changes?
A. Replacement Cost Method
B. Current Purchasing Power Method
C. Opportunity Cost Method
D. Current Cost Accounting Method
E. Standard Cost Method
Choose the correct answer from the options given below:
Which of the following is/are correct?
I. All permanent accounts are balanced and carried forward to the next accounting period.
II. The temporary accounts are closed at the end of the accounting period.
