Important Question for Class 11

Accountancy

Chapter 11 - Accounts from Incomplete Records

Very Short Answer Questions 1 Mark

1. Define the term incomplete record.

Ans: Incomplete records refer to transactions that are not recorded using the double
entry system.

2. Why incomplete records are kept?

Ans: To keep track of the cash account, debtors account, and creditors account,
incomplete accounts are kept.

3. Fill in the blanks

i. Incomplete entry system has ____ sided effect.

Ans: Incomplete entry system has one sided effect.

ii. A _____ cannot be prepared in single entry system.

Ans: A Trail balance cannot be prepared in single entry system.

iii. ______ is the statement of assets and liability under single entry system.

Ans: Statement of affairs is the statement of assets and liability under single entry
system.

Class XI Accountancy www.vedantu.com 1

iv. Advance commission received is mentioned on _____side in statement of
affairs.

Ans: Advance commission received is mentioned on liability side in statement of

affairs.

4. True- false

(i). Cash in hand can be obtained by preparing cash book.

Ans: True sentences: cash in hand can be achieved by preparing a cash book.

(ii). Trail balance can be prepared of incomplete record.

Ans: It is impossible to prepare a Trial Balance under this system since incomplete
records are kept. Is the sentence false.

(iii). Bad-debts written off will affect the debtors.

Ans: The fact that bad debts are wiped off has an impact on the debtors is true.

(iv). Statement of affairs is prepared under single entry system.

Ans: True sentence: A statement of affairs is prepared using a single entry system.

5. How loss during the period can be ascertained.

Ans: The difference between opening and closing capital shows the loss incurred
throughout the time.

Short Answer Questions 2 Marks

1. What do you understand by statement of affairs?

Class XI Accountancy www.vedantu.com 2

Ans: The statement of affairs is a summary of a company's assets and liabilities. The
statement of affairs determines the net book value and the amount expected to be
realised at the time of the company's insolvency.

2. Explain how payment to creditors may be ascertained through incomplete

record.

Ans: Payments to creditors are frequently missing due to insufficient records. To

figure it out, create a total creditors' account and subtract the whole purchase return
from it.

3. Explain how collection from debtors may be ascertained through incomplete

record.

Ans: Incomplete records make it difficult to recover from debts. To figure it out,
create a total debtors' account and subtract the total sales return.

4. What are the similarity of balance sheet and statement of affairs?

Ans: Both the balance sheet and the statement of affairs present the company's assets
and liabilities at a specific date, and they aid in establishing the company's liquidity
and stability.

5. How closing balance of cash can be ascertain from incomplete records.

Ans: Incomplete records frequently overlook the cash closing balance. To assess it,
a cash book summary is created, which contains all of the payments made and all of
the receipts received throughout the year. The closing cash balance will be
determined by the balancing figures.

Class XI Accountancy www.vedantu.com 3

Short Answer Questions 3 Marks

1. Explain how credit sale and credit purchase may be ascertained through
incomplete record.

Ans: Incomplete records frequently overlook credit purchases and payments. The
total debtor's accounts are prepared, from which the total sales return is deducted, to
determine credit sales. To determine credit buy, total creditors accounts are created,
and total purchase returns are subtracted.

2. Determine the format of credit account.

Ans: The format of credit account is given below:

Date Particular L.F Amount Date Particular L.F Amount

To Cash Paid By Balance b/d
By
To Bank Bank(cheque
To Bill payble dishonoured)
To Discount By Credit
Receivable purchase
To Purchse
return

To Balance c\d

3. Why incomplete records are maintained?

Ans: For the following reasons, businesses may keep incomplete records.

i. Due to a lack of accounting knowledge.

ii. Keeping two accounts demands experience.

iii. Keeping two sets of books is costly and time-consuming.

iv. A single accounting system only necessitates the keeping of a few books.

Class XI Accountancy www.vedantu.com 4

v. It is more convenient to record the important transactions and ignore the rest.

4. What are the difficulties encountered by companies due to incomplete

records?

Ans: Companies have issues as a result of inadequate recordkeeping.

i. Because a trail balance cannot be calculated, the accuracy of the accounts cannot
be determined.

ii. Income tax authorities are difficult to persuade in terms of the accuracy of the
record's computation

iii. Incomplete records make it impossible to determine a financial statement.

iv. Insurance claims are not permitted to be filed with incomplete records.

5. How statement of affairs helps in ascertaining the profit or loss?

Ans: The capital will be provided by the statement of affairs at the beginning and
conclusion of the accounting period. From which a profit and loss statement is
derived determined to determine whether there was a profit or loss during the period
of accounting The formula for calculating profit and the loss is calculated as follows:
Capital at the start – Capital at the end – Drawings over the year + During the Profit
year, capital was introduced.

Long Answer Questions 5 Marks

1. Explain how opening and closing capital may be ascertained through

incomplete record.

Ans: By drafting the statement of affairs at, you can determine the opening capital
based on inadequate records. The start of the accounting period and the preparation

Class XI Accountancy www.vedantu.com 5

of the financial statements asset and liability statements at the start of the year the
period of accounting. This statement will be similar to the one below. It is possible
to calculate the balance sheet and the opening capital.

Due to the disparity between the two sides of the statement of facts While the closing
balance is determined at the conclusion of the accounting period, the assets and
liabilities statements are prepared at the end of the accounting period. The difference
between the two sides of the statement of affairs can be used to calculate closing
capital.

2. Differentiate between statement of affairs and balance sheet.

Ans: The following is a list of the differences between a statement of affairs and a
balance sheet:

Statement of affairs Balance sheet

It is made up of data that isn't
complete.
It is not included in the financial
statement.
It is used to estimate the capital
account balance on a specific date.
It is difficult to detect omissions of any
assets or obligations.
It's made up of double-entry records.
It is included in the financial statement.
It is used to determine the true value of
a company's financial status.
The balance sheet is an excellent tool
for detecting omissions.

3. Write down the Performa for ascertaining profit and loss of a company by
statement of affairs.

Ans: The following is the Performa for determining a company's profit and loss
using a statement of affairs:

Particular Amount Amount

Ending capital ________
Add: Drawings during ________
the year

Class XI Accountancy www.vedantu.com 6

 Less: Additional capital ________
introduced during the
year _________
Adjusted capital at the ________
end of year
Less: beginning Capital

Profit or loss during _________

Year

4. Calculate value of profit earned during the period if opening capital is ₹

50,000, drawings is ₹ 5,000, additional capital introduced during the period is ₹
20,000, closing capital ₹ 1,00,000.

Ans: Determine the profit value.

Particular Amount Amount

Ending capital 100000

Add: Drawings during 5000

the year

Less: Additional capital 20000

introduced during the
year

Adjusted capital at the 85000

end of year

Less: beginning capital 50000

Profit during year 35000

Thus during the year is ₹ 35,000.

5. Calculate Capital at the beginning from the following information:

Particular Amount

Class XI Accountancy www.vedantu.com 7

 Ending capital 500000
Drawing during the year 70000
Additional capital introduced during 200000
the year
Current year profit 90000
Ans: At the start, the capital formula is,

Capital at beginning = Ending Capital + Drawings during the year-

Additional Capital introduced during the year – Profit

= 5,00,000 + 70,000 - 2,00,000 - 80,000

= 2,90,000

As a result, the initial capital is Rs. 2,90,000.

Class XI Accountancy www.vedantu.com 8