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cesForSt
udi
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¸ÀA¥Áz ÀPÀgÀÄ
SunilKM.com,B.Ed,PGDBA
Commer
ceLect
urer
Nagamangal a

1
 CHAPTER-
1
I
NTRODUCTI
ONTOACCOUNTI
NG

1.
Whati sBookkeepi
ng?
Bookkeepi
ngisthear
tofr
ecor
dingbus
ines
str
ans
act
ionsi
nas
yst
emat
icmanner
.

2.
Gi vethemeaningofAccount
ing?
Accounti
ngisthepr
ocessofi
denti
fyi
ng,
Meas
uri
ngandc
ommuni
cat
ingf
inanc
ial
infor
mationtoenduser
s .

3.
WhatisAcc
ountanc
y?
Ac
count
ancyi
sthetheor
yandpr
act
icesofac
count
ing.

4.
Whatar etrans ac
tions
?Mentionitstypes
?
Atransact
ionmeansanevent ,act
ivi
tyordeal
ingi
nvol
vingt
heexc
hangeofmoneyor
money ’
swor t
hbet weenthepersons.
a)CashTrans acti
on
b)CreditTrans acti
on

5.
Expl
aint
hef
oll
owi
ngt
erms
.

a)Capi
tal
:Theamountofmoneyormoney’
swort
hinves
tedori
ntr
oducedbythe
propr
iet
orint
ohisbus
ines
sattheti
meofcommencementofbus
iness
.

b)Dr
awi
ngs:Ref
erstocas
horgoodswi
thdrawnbyt
hepr
opr
iet
orf
rom hi
sbus
ines
s
f
or
hi
sper
sonal
,pri
vat
eordomes
ticuse.

c
)As
set
s:Theval
uabl
ethi
ngsownedbyt
hebus
ines
s.

d)Li
abi
li
ti
es:Theobl
igat
ionsordebt
spayabl
ebyt
heent
erpr
isei
nfut
urei
nfor
mof
moneyorgoods,

e)Debt
or:I
saper
sonwhoowesmoneyt
othebus
ines
s.

f
)Cr
edi
tor
:Isaper
sont
owhomt
hebus
ines
sowesmoney.

g)St
ock:Thegoodsavai
labl
ewi
tht
hebus
ines
sfors
aleonapar
tic
ulardat
e.

h)Pr
ofi
t:Exc
essofr
evenueoverexpens
es.

i
)Los
s:Exc
essofexpens
esoverr
evenue.

j
)Vouc
her
:thedoc
ument
aryevi
denc
eins
uppor
tofat
rans
act
ion.

2
 CHAPTER-
2
THEORYBASEOFACCOUNTI
NG

1.
ExpandGAAPandI CAI.
GAAP:Gener all
yAc c
ept edAccounti
ngPr i
ncipl
es
ICAI:Insti
tut
eofChar tedAccountsofIndia
2.
Gi vethemeani ngofac count
ingconcept s
.
Theas sumpti
onsandi deaswhicharefundament altoac
counti
ngpracti
ce.
3.
Gi vethemeani ngofac count
ingconvent i
ons.
Thec ustomsandpracticeswhicharefoll
owedt oprepar
eFinanci
alSt
atement
sofa
businessconcern.

4.Expl ai
nanyt woAc count ingc onvent i
ons .
a)Convent i
onofc ons i
s tenc y: Its i
gnif
iesthatt heac countingpracti
cesandmet hods
shouldpr acti
c es andmet hodss houldr emai nconsistentf rom oneaccountingyeart o
another
b)Convent ion ofc ons er vatism:I tmeans Thos e bus i
nes strans
actionss hould be
recorded
insuc ha wayt hatpr ofits houldnotbeovers tatedandf ut
urel ossshouldbe
considered.
c)Convent i
onoff ulldi sc l
os ur e:Ac count i
ngmus tdiscloseallmateri
alinformation.
d)Convent ionofmat erial i
ty:I tmeansr ec
ordonl yoft hosebus i
nes stransacti
ons
which
aresignif
icant( mat er i
al )andi nsi
gnificanttransactionar ei
gnored.
5.Whati sDoubl eEnt rys yst emofbookkeepi ng?
Doubl eent r
ys ystemi sac ompl et eands ci
ent i
fi
cmet hodofbookkeepi ngasbot h
(DrandCr )aspectsoft rans ac t
ionsi srec orded.
6.Whatar eAc countingSt andar ds ?
Thepol icydoc ument si ssuedbyr ecognizedac countingbody.

7.
Wr i
teanytwoAc count i
ngSt andardsac
cept
edunderI
AS.
AS-2–Valuat
ionofI nventor
y
AS-3-Cashfl
ows tatement
AS-6-Depreci
ati
onAc count
ing
AS-10Accounti
ngf orfixedasset
s

8.
Explai
nanyf iveAc count i
ngc onc epts?
a)Busi
nes
sEnt ityConc ept:Undert hi
sc onc
eptt hebus i
nes stransactions houldbe
separatedf romt hepersonaltransac ti
onoft hepr oprietor
.
b)MoneyMeas urementConc ept:Itmeanst hatinaccount i
ngar ecordismadeonl yof
thosetransactionswhi c hcanbemeas uredandexpr essedi ntheter msofmoney.
c)Goi
ngConc ernConc ept:Itmeanst hatabus i
nessent erprisewi l
lcontinuet ooperate
f
oraf airlylongper i
odoft ime.
d)Acc
ountingPer i
odConc ept: Meanst hattomeas ur
et hef inancialresultsofbus i
nes
s,

3
 t
hebus
ines
swor
kingl
if
eiss
pli
tint
oconveni
ents
hor
tper
iodsof12mont
hst
ime.

e)DualAs
pec
tConc
ept:I
tisr
elat
edtoever
ytr
ans
act
ionwhi
chi
sspl
itupi
nto
DrandCraspec
t.

CHAPTER-
3
RECORDI
NGOFBUSI
NESSTRANSACTI
ONS-
I

1.Whati sAccount i
ngEquat i
on?
Theequat ionbet weent het ot
alas
set
sandt
otall
iabi
li
ti
eswi
thowner
’sc
api
tali
s
st
ated
intheformofanequat i
on.
i.ASSETS=LI ABI
LITI
ES+CAPITAL
ii
.CAPITAL=ASSETS- LI
ABILITIES
ii
i.LI
ABILITIES=ASSETS-CAPITAL

2.
Whati sAc c
ount i
ngc yc
le?
Theproc
es sinwhichac c
ounti
ngtr
ans
actionspasst
hroughac yc
lic
alpr
ocessof
jour
nali
sing,ledgerposti
ng,
draf
ti
ngtri
albalanc
eandpr epar
ingfi
nanci
als
tatement
.

3.
Whatisjournal
?
I
njour
naleachtrans
act
ioni
scl
ass
ifi
edi
ntodebi
tandc
redi
tas
pec
t.

4.
WhatisNarrati
on?
Abr
iefex
planati
ontot
hej
our
nalgi
veni
nbr
acket
sst
artwi
thBei
ng.

5.
ExplainDebi tandcredi
tr uleunderEngli
shs yst
emofac c
ounti
ng
Engl
ishs ys
temofac count ing
PersonalA/c Debi ttheRec ei
ver CredittheGiver
RealA/ c Debi
twhatc omesi n Creditwhatgoesout
Nomi nalA/c Debi tallexpens esandl
osses Cr edi
tallinc
omesandGai
n

6.
Whati sLedger?
Ledgerisabookwhic
hc ontai
nsas
ummar
ised,
clas
sif
iedandper
manentf
ormof
recor
dingalltr
ans
actions.

7.WhatisPost
ing?
Pos
tingi
stheproces
soft
rans
fer
ringt
heent
riesf
romJ
our
nalt
othel
edger
.

8.Whati sDebitandCr editBalanc e?

DebitBalance: I
fthedebi tsi
det ot alofanaccounti
sgreaterthanthecr
editsi
detotal
,
t hebalancei sDebi tBalance.
CreditBalance:Ifthec r
editsidet otalofanaccounti
sgreaterthanthedebits
idetotal
,
thebalanc eisCr editBalance.

4
 CHAPTER-4
RECORDI
NGOFBUSINESSTRANSACTI
ONS–I

1.
Gi vet
hemeani ngofSubs
idiar
yBook.
Subsi
diar
ybooksarethespeci
aljour
nal
smai ntai
nedf
orr
ecor
dingal
lthebus
ines
s
tr
ansacti
onsundermodernsystemofaccounti
ng.

2.WhatisanInvoic
e?
I
tisthewr i
ttenstatementgivi
ngt hepart
icular
softhequant
ityqual
it
yandthepr
ice
of
goodspur c
hasedon c redi
t.Thissamei nvoic
ei sknown asinwardinvoi
ceforthe
purc
haser
andoutwardinvoiceforthesell
er.

3.WhatisPur
chas
ebook?
Purchas
ebookisas ubs
idi
arybooki
nwhi
chonl
ycr
edi
tpur
chas
esofgoodsar
e
recor
ded.

4.
WhatisSal
esbook?
I
tisas
ubsi
diar
ybooki
nwhi
chonl
ycr
edi
tsal
eofgoodsar
erec
orded.

5.Whati sDebi
tnote?
Att het imeofreturnofgoodsadoc
umenti
spr
epar
eds
howi
nggoodsr
etur
nedt
o
suppli
ers.
Thedoc umentiscal
ledDebi
tnot
e.

6.WhatisCr
edi
tnot
e?
Credi
tnotei
sthedoc
umentpr
epar
edt
orec
ordt
hequant
ityandval
ueofgoods
ret
urned
byc ust
omer
s.

7.
Whati sTr
adeDiscount
?
Tr
adedisc
ountisall
owedbythesell
ertothebuyer
.Iti
sal
lowedwhenac
ust
omer
purchas
esgoodsaboveacert
ainquanti
tyoramount.

CHAPTER-5
BANKRECONCI
LIATI
ONSTATEMENT

1.
Whati
sBankRec
onc
ili
ati
onSt
atement
?

5
 Ast
atementpr
eparedt
oreconci
lethebankbal
anc
easpercashbookwit
hthebal
ance
asperpass
bookorbankst
atement,byshowi
ngthei
temsofdi
ff
erencebet
weenthetwo
ac
counts
.

2WhataretheCaus
esofdif
ference?
–timingofrec
odi
ngthetransac
tion
–errormadebybusi
nessorbythebank.

CHAPTER-6
TRIALBALANCE&RECETIFICATI
ONOFERRORS
1.
WhatisTr
ialBalance?
As
tat
ements howingtheabs
trac
tofthebal
anceofvar
iousac
count
sint
hel
edger
.

2.
MentionanytwoObjec
tivesofTri
alBalanc
e?
i
)Toascer
tai
nthear
thmet i
calac
curac
yoftheledgerac
count
s

i
i)Tohel
pinl
ocat
inger
ror
s i
ii
)Tohel
pint
hepr
epar
ati
onoft
hef
inalac
count
s

3.
MentiontheTypesofError
s?
1.
Err
orsofCommi s
sion 2.
Err
orsofOmiss
ion
3.
Err
orsofPri
ncipl
e 4.Compensat
ingEr
rors

4.
Whati sRec t
ifi
cati
onofErrors?
Err
orsaff
ec t
ingonlyoneaccountc
anberect
if
iedbygi
vinganexplanat
orynoteorby
passi
ngaj ournalent
ry.Er
rorswhi
chaf
fectt
woormoreac count
sarerect
if
iedby
passi
ngajournalentry.

5.Defi
neSuspenseAc count?
Anac c
ountinwhichthedifferenceinthetr
ailbal
ancei
spullti
lls
ucht i
methat
er
rorsarelocat
edandr ec
tifi
ed.Itfaci
li
tat
est hepr
eparat
ionoffinanci
alst
atement
s
even
whenthetrai
lbalanc
edoesnott al
ly.

6
 CHAPTER-7
DEPRECI
ATI
ON,PROVISI
ONS&RESERVES

1.WhatisDepreci
ation?
Depreci
ati
on is decli
ne int he val
ue ofa t angi
blefixed asset
.In acc
ount
ing,
depreci
ati
on
i
st hepr
ocessofalloc
atingdeprec
iabl
ecostoverusef
ulli
feofafixedass
et.

2.
Whatar et
heFactorsaf
fect
ingDepreci
ation?
i
)WearandTearduetouseorpassageoftime
i
i)Ex
pir
ati
onofLegalRi
ghts ii
i)Obsoles
c enc
e

3.
Whatar ethemethodsofchargingDepreci
ati
on?
i
)Str
aightLi
neMethod i i
)Wr i
ttenDownValueMethod
i
ii
)Annuit
yMethod i v)Reval
ut i
onMethod v)Si
nki
ngFundMet
hod

4.
WhataretheFac
tor
saf f
ec t
ingtheamountofDepr
eciat
on?
i
)Or
ginalCos
t i
i)SalvageValue i
ii
)Usef
ulli
feoftheas
set

5.WhatisProvis
ions&Res erves?
Aprovi
s i
onisac har
geagainstprof
it.I
tiscreat
edfoeaknownc ur
rentli
abil
it
ythe
amountofwhi chisuncert
ain.Reser
veont heotherhand,
isanappropr
iati
onofprof
it
.
I
tiscreatedtostrenghtenthefi
nancialposi
ti
onofthebusines
s.

6.
Ment i
ont hetypesofReser
ves?
i
)Generalres
erve&s pec
ifi
cres
erve i
i)Revenuer
eser
ve&c
api
talr
eser
ve

7.
DefineSecretReserve?
Whentotaldeprec
iati
onchargedishi
gherthanthet
otaldepr
eci
ablecos
t,Sec
ret
r
eservei
sc r
eated.Secr
etres
er vei
snotexpli
ci
tl
yshowninthebalanc
esheet.

7
 CHAPTER-8
ACCOUNTI
NGFORBILLSOFEXCHANGE

1.
Whati sBi
llofexchange?
Abil
lofexchangeisanacknowledgementofdebtgi
venbyonepers
ont
o
anot
her,i
ncorpor
atingal
lthetermsandconditi
onsofpayment
s.

2.WhatisaPromiss
oryNote?
Apromiss
orynoteisanunder
taki
ngi
nwri
ti
nggivenbythedebt
ortot
hecredi
torto
paythelat
teracert
ainsumofmoneyi
nac
cordancewit
hthecondi
ti
onsst
atedther
ein.

3.
Stateanyfouressent
ialfeat
uresofbillofexchange.
•Abil
lofexchangemus tbeinwr i
ti
ng. •Itisanor
dert
omakepayment.
•Theordert
omakepay menti sunconditi
onal. •Themakeroft
hebi
llofexc
hange
mus tsi
gnit
.
•Itmustbestampedasperther equi
rementofl aw.

4.Statet hethreepar tiesi

nvolvedinabil
lofexc hange.
i)Drawer :draweri sthemakeroft hebi
llofexchange. Asell
er/creditorwhois
entit
ledt orec eivemoneyf rom thedebtorc andr aw abi llofexc hangeupont he
buyer /
debtor.
ii
)Dr awee:dr aweei sthepersonuponwhomt hebillofexchangei sdr awn.
Draweei sthepur chaserordebtorofthegoodsuponwhomt hebillofexc hangeisdr
awn.
ii
i)Payee:pay eei sthepersontowhomt hepaymenti stobemade. Thedr aweroft
he
billhimselfwillbet hepayeeifhekeepsthebillwithhimt i
llthedat eofitspayment.

5.
Whatar ethefeat utesofPromissorynote?
•Itmus tbeinwr iti
ng •I
tmus tcont
ainanuncondi
ti
onalpr
omi s
etopay.
•Thes umpay ablemus tbecert
ain.•Itmus tbes
ignedbythemaker.
•Themakermus tsignit. •Itmustbepayabl
et oacer
tai
nperson.
•Itshouldbepr oper l
ys t
amped.

8
6.
Whataret hediffer
enc ebetweenabillandanote.
(
a)Abil
lispreparedbyt hecredi
torandaccept
edbythedebtor
;anot
eispr
epar
ed
bythedebt or.
(
b)Ther
ear ethreepartiest
oabi l
l;t
hereareonlyt
woparti
estoanot
e.
(
c)Abil
lrequiresacceptanc
et o

CHAPTER-9
FI
NANCI
ALSTATEMENTS-I&I
I

1.Whatdoyoumeanbyf i
nalac countsandwhydowepr epar
efinalaccounts?
Fi
nalaccountsaresummar iesofledgeraccountspreparedtoshowt hepr of
itorlos
s
ofthebusinessandfinanc
ialpos i
ti
onoft hebusinessattheendoft heaccountingyear.
Itconsi
stofTradingA/c,Profi
tandl ossA/candBal anc
es heet.
Itispreparedto
ascer
tai
nt hetruefi
nancialposi
tionofthebus i
ness.

2.
WhatisBalanc
es heet?
Iti
sast
atementofassetsandli
abil
iti
esofabusines
sprepar
edattheendoft
he
acc
ount
ingperi
odwi t
htheobjectofascer
tai
ningthefi
nanci
alpos
iti
onoft
hebus
ines
s.

3.Whatistradingaccount?
Anaccountwhi chshowsonl yt
heres
ultoft
radi
ngwithalldir
ectexpensesanddi
rect
i
ncomesc all
edGr ossProf
it(G.P=Cr
editsi
de>
Debits
ide)orGrossLoss(G.
L=Debitside
>Credi
tside).

4.Whatisprof
itandlossaccount?
I
tisanac countprepar
edwi thal
lthei ndi
rec
texpens
esandi
ndi
rec
tinc
omest
o
as
certai
n
Netprof
itorNetlossoft
hef i
rminapar
tic
ularperi
od.

9
 CHAPTER-11
I
NCOMPLETERECORDSOFTRANSACTI
ONS

1.Whati sInc
ompl et eofRecordTrans
acti
ons
?
Incompleter ec
or dsrefert
o,l
ackofacc
ounti
ngr
ecor
dsacc
ordi
ngtothedoubleentr
y
system.Degr ee ofi ncomplet
enessmayvar yfr
om hi
ghlydisor
gani
sed recor
dst o
organised,
buts ti
llnotcompl ete.

2.
Whatar ethefeat ur
esofIncompl eteRec ords
?
(
a)Iti
sanuns ystematicmethodofr ecordingtrans act
ions.
(
b)Personaltr
ans ac
t i
onsofowner smayal sober ec or
dedinthec as
hbook.
(
c)Diff
erentorganisati
onsmaintainrecordsacc ordingtotheirc
onveni
enceandneeds
,
andtheirac
countsar enotcompar abl
eduet olac kofunif
ormity.

3.Ment iontheLimit ationsofSi ngleEnt r

ySys tem?
a)Asdoubl eentrys y stemisnotf ollowed, atrialbalancecannotbepr eparedand
accuracyofaccount scannotbeens ured.
(b)Cor r
ectascertainmentandeval uati
onoff inanc i
alresul
tofbus i
nessoperati
onsc an
notbemade.
(c)Analysisofprofitabili
ty,l
iquidityands olvenc yofthebusinesscannotbedone. This
mayc aus eapr oblem i nr aisi
ngf undsf rom out sidersandpl anningf ut
urebusiness
ac
t i
viti
es .
(d)Theowner sfac egr eatdiffi
cultyinfil
ingani nsurancecl
aimwi thaninsurance
companyi ncas eofl ossofinvent or
ybyf i
reort heft.

10
 CHAPTER-12&13
Appl
icat
ionsofComput
ersi
nAccount
ing&Comput
eri
sedAc
count
ingSys
tem

1.WhatisComput
er/ComputerSystem?
computerisanel
ectr
oni
cdevice,whi
chiscapabl
eofperf
ormingavari
etyofoperat
ions
asdirec
ted byas etofins
tructi
ons.Thi
ss etofinst
ruct
ionsiscall
ed ac omputer
pr
ogramme.

2.
WhataretheElementsofComputerSys
tem?
Sof
twar
e,Har
dware,Peopl
e,Pr
ocedures
,Dat
a,Connec
tivi
ty

3.
Whatar etheCharact
eris
ticsofComputerSys
t em?
Speed,Ac
c ur
acy,Rel
iabi
lit
y,Versat
il
it
y,Storage

4.
Whatar etheFeat uresofComput eri
sedAc count
ingSys t
em?
•Onli
nei nputands t
or ageofaccountingdata.
•Pri
ntoutofpur chas eands al
esinvoices.
•Logicalschemef orc odif
icat
ionofac count
sandt r
ans ac
tions
.Ever
yac
countand
t
ransactionisassignedauni quec ode.
•Groupingofac c
ount sisdonefromt heverybeginning.

5.
WhataretheComponentsofComputer
?
I
nputUni
t,Cent
ralPr
oces
singUni
t,Out
putUni
t
6.
WhatisMIS?

11
 Amanagementi nf
ormat i
ons ys
tempr ovidesi
nfor
mationnec essar
ytotakedeci
sions
andmanageanor ganis
ationeffec
tivel
y.
7.
Whati sAIS?
Account
inginf
ormationsystemont heotherhandidenti
fies,
c ol
lect
s,proces
ses
andcommuni c
ateseconomicinformationaboutanentit
yt oawi devari
etyofus
ers.

8.Whati sComput er i
sedAc counti
ngSys tem?
Ac omput er
ised ac counting system is an ac counti
ng inf
ormati
on s ys
tem that
processes
thef i
nancialtr
ans acti
onsandevent stoproducereportsasperuserr
equir
ement s.
Iti
s
basedont heconc eptofdatabaseandhast wobasicrequi
rements:(
a)Accounti
ng
framewor kand( b)Oper ati
ngProc edure.

9.
Whatar etheAdvant
agesofComputeri
sedAccount
ingSyst
em?
•Speed •Ac cur
acy •Reli
abil
ity •Up-to-
date
•Scal
abil
it
y •Legi
bil
it
y •Effi
cienc
y •Qual it
yReport

10.WhataretheLimi
tati
onsofComput er
isedAccounti
ngSyst
em?
•Costoftr
aini
ng •St af
fOppositi
on •Di s
ruption •Systemfai
lur
e
•Breacheofsecur
ity •Il
l-ef
fect
sonheal t
h •I nabi
li
tytocheckunant
ici
pat
ed
err
ors

ACCOUNTINGDICTIONARY
1)Bookkeepi
ng:Anar
taswellassci
enceofrecordi
ngallt
hefinanci
alt
rans
act
ions
anddeal
inginasetofbooksiscall
edbookkeeping.

2)Account
ing:Accounti
ngisapr ocessofr
ecoding,cl
ass
ifyingandsummari
zi
ngof
financi
aldataint
oas yst
emati
cformandint erpr
eti
ngthem.
Acc
ounti
ngEquat i
ons:Assets=Li abil
it
es+Capital

3)Accountanc
y: I
ti s an appli
cati
on of ac
counti
ng pri
nci
ples & accounti
ng
convent
ionstos
olvetheaccounti
ngprobl
emsitincl
udesbot
hbook-keepingand
account
ing.

4)Branches OR Phas
es ofAc
count
ing: * Fi
nanci
alAccounti
ng * Management
Acc
ounti
ng
*Cos
tAccount
ing*Mechani
calAc
counti
ng

5)Financ
ialAccounti
ng:AnAccount
ingforal
lfi
nanc
ialt
ransac
tionsofanent
erpr
ise
withtheobjec
tiveofasc
ert
aini
ngprofi
torlos
smadeduringperi
odiscall
edfi
nanc
ialA/
C

6)Obj
ecti
vesandAdvant agesofAcc ount
ing:*Tomai
ntainaccount
ingrec
ords
*ToAscert
ainprofi
torlossforaperiod *Topresenttr
ueandf ai
rvi
ew
*Toknowt heinf
lowandout flowofc as
h

12
7)Casht
rans
act
ions:Thetrans
acti
onwhichinvolvetheimmedi
atepaymentofc
ash
thes
e
donotcr
eateanyobl
igat
iononthepart
iest
othesame

8)Cr
edi
ttr
ans
act
ion:Thetr
ansacti
onorac
tivi
ti
esinwhic
hpaymentofcashi
spostponed
suchtr
ansact
ionscr
eatetherel
ati
onshi
pofdebt
orandcr
edit
or

9)Goods
:Theter
mgoodsinc
ludesal
lcommodit
ies
,ar
tic
lesorpr
oduc
tswhi
char
e
pur
chasedf
ort
hepurposeofres
ale

10)Fol
io:I
tshowsthepagenumberoft
heot
herbookf
romwher
etheent
ryhasbeen
t
ransf
err
edorposted

11)Car
rieddown:Thepr
oc es
softaki
ngabal
anc
eanac
countt
othenextper
iodatt
ime
c
losi
ngoftheaccount

12)Br
oughtdown:Theprocessofbri
ngi
ngdownthec
los
ingofpr
evi
ousper
iodt
othe
nextper
iodinthesameacc
ount

13)J
our
nal
:Thebookofor
igi
nalentr
yorpr
imeent
ryi
scal
ledj
our
nali
tist
hef
irs
t
stepofac
count
ingproces
s

14)Ledger:Ledgeri
sabookoff
inalent
ryc
ont
aini
ngac
count
sli
keper
sonala/
c,r
eala/
c
nominala/c.

15)Pos
ting:Posti
ngisaproc
essoft
rans
fer
ringt
heent
riesoft
rans
act
ionf
romj
our
nal
iscal
ledpost
ing

16)Accounti
ngconcept
s:*Bus
inessent
ityc
oncept*Goi
ngconc
ernconc
ept
*Dualaspectc
onc
ept*Reali
zati
onofconcept*Owner
shi
pentit
yconc
ept

17)Doubl
eEntr
ysystem:Doubl eent
rysyst
emmeanst hemethodofrecor
dingoft
wo
fol
daspect
sofatransac
tion.Theeverytr
ansac
tionaf
fect
sthefinanci
alposi
ti
onint
wo
ways

18)Advant
agesofdoubleent
rysyst
em:Completerec
ord,Arit
hmeti
caccur
acy,upto
dat
einformat
ion,
rel
iabi
li
ty,
hel
psforrepor
tingandi
nter
pretat
ion

19)Typesofac counts:
a)Pers
onalac counts:Theaccountsopenedint henameofper son,pl
acesand
ins
tituti
onsarecalledpersonalaccountsEg:Rama/ c,Gokaka/c.Banka/c
b)Realaccounts:Theac c
ountsopenedf orpropert
ies,as
setsandpos s
essi
onswi t
h
whichwec arr
ybus i
nessar ecall
edrealaccountsEg:casha/c,
assetsa/
c
c)Nominalaccounts:Theaccountsopenedf orexpensesandinc omesarecal
led

13
 nomi
nalac
count
sEg:s
alar
ya/
c,r
enta/
c,i
nter
esta/
c

20)Thethreer ul
esofaccounts
Personalaccounts–Debittherecei
verCreditt
hegiver
Realaccounts-Debitwhatc omesinCreditwhatgoesout
Nomi nalacc
ount s-Debi
tex pens
esandlos s
esCredi
tincomesandgai
ns

21)Featuresandobject
ivesofJour
nal
:
a.Journali
swritt
enever yday b.Iti
sbookofori
ginalentr
y
c.Compl et
erecordatoneplace d.Bestf
orc
rosschecking

22)Nar
rat
ion:I
tisshor
texplanati
onoft
rans
act
ionr
egar
dingt
her
eas
onf
or
debit
ingandcredit
ing

23)Bal
anc
ingofac
count
s:Thepr
ocessofc
los
ingt
heac
countbyt
aki
ngt
het
otalofs
ide
whic
hhastheamount

24)Subs
idiarybooks:Subs
idi
arybooki
sabookofori
ginalent
rywhi
chsubst
itut
efor
j
ournalEg:sal
esbook,purchas
ebook,
sal
esret
urnbookandpurchas
ereturnbook

25)Cas
hbook:Itisanimportantbookofacc
ounti
nwhi
challc
asht
ransac
tionsar
e
recorded.I
tcanalsobeprepar
edwit
htwocol
umns&threecolumnsli
ke
cas h,di
scount&bankc ol
umns

26)Pet
tyc
ashbook:Thecas
hbookwhi c
hispreparedf
orr
ecor
dthepet
tyt
rans
act
ions
li
keteaexp,
stat
ioneryexpetc
.

27)Typesofpett
yc ashbook:
a)Analyti
calpet
tyc as
hbook–Thec ashbookopenedt
orecor
dthepett
y
trans
acti
onsinex plai
nedmannerwi t
hs epar
atecol
umnsiscal
ledanal
yti
calpet
ty
cashbook
b)Simplepettycas
hbook–I tisopenedwit
hs i
ngl
ecol
umn

28)Bankreconcil
iat
ionst
atement:Thes
tatementpr
eparedattheendofever
ymontht
o
expl
ainthecausesf
ordi
ff
erencebetweenbal
ancesofpas
sbookandc as
hbook

Pr
act
icalOr
ient
edQues
tions

1.Dr
awadi
agr
amofAc
count
ingPr
oces
s

14
2.
Wri
tet
heAc
count
ingEquat
ionandf
indt
hemi
ssi
ngf
igur
es

3.
Pas
sJour
nalEnt
riesf
romLedgerAc
count
swi
thf
iveent
ries

4.
Draf
taSpec
imenofDebi
tVouc
her

15
5.
Draf
taSpec
imenofCr
edi
tVouc
her

6.
Prepar
eaSi
mpl
eCas
hBookwi
thf
ivei
magi
nar
yfi
gur
es

7.
Prepar
eaTr
ialBal
anc
ewi
th10i
magi
nar
yfi
gur
es

16
8.
Prepar
eMac
hiner
yA/
cfor2year
swi
thi
magi
nar
yfi
gur
esunderSLM

9.
Prepar
eMac
hiner
yA/
cfor2year
swi
thi
magi
nar
yfi
gur
esunderWDVM

10.
Prepar
eaSpec
imenofBi
llofExc
hange

11.
Prepar
eaSpec
imenofPr
omi
ssor
yNot
e

12.
Prepar
eTr
adi
ngA/
cwi
thf
ivei
magi
nar
yfi
gur
es

17
13.
Prepar
eBal
anc
eSheetwi
thf
ivei
magi
nar
yfi
gur
es

14.
Prepar
eOpeni
ng/
Clos
ingSt
atementofAf
fai
rswi
thf
ivei
magi
nar
yfi
gur
es

18
15.
DrawaBl
ockDi
agr
amofMai
nComponent
sofComput
er

I
mpor
tantNote:Outof3POQst
obeasked,
Choos
eFir
stPOQfr
omSr.No.1t
o5,
Sec
ondPOQf r
omSr.No.
6to10andThi
rdPOQfr
omSr.
No. 11t
o15.

Li
fei
slikeAccount
ing,
Everythi
ngmus tbeBal
anc
e…
- Unknown

“Educat
ionist
hemostpower
fulweapon
whichyoucanuset
ochangetheworl
d”
- Nel
sonMandel
a

19
 ForDet
ail
s

SHARADACOMMERCECOACHI NGCENTRE
(Tui
ti or1st&2ndPUC,
onf B.Com&BBA)
Mul
akat
teRoad,
T.B.
Ext
ens
ion,
Nagamangal
a–571432

Cont
actDet
ail
s:9535760322,
9844957931

20