Describe the various types of accounting software along with their advantages and limitations.
1) Ready to Use Software: A variety of readymade softwares is available in the market. These softwares are for users at large and are not developed according to the requirements of any specific user. Most popular readymade softwares available in the market is Tally, Ex. Busy etc.
Advantages | Disadvantages |
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1. These softwares are developed by a group of highly experienced group of professionals. |
1. These softwares use laser printers which are costly than the use of Dot Matrix Printers. |
2. Since these softwares are used by a large number of users, accounting personnel well versed with these software are easily available. | 2. The lwvwl of Secrecy in these software is very low thus the siftware is highly prone to frauds. |
3. They are easy to learn and their training is sometimes offered free by the vendor. | 3. These software offer very little scope of linking to other information systems. |
4. Because of their use by a large numbers of users, they have better after sales maintenance service. | |
5. Because they are available off-the-shelf , time required in developing a tailor made software is saved. | |
6. The cost of installation is low. |
2) Customised Software: The term 'Customised Software' means making changes in the ready to use Software so as to suit thespecific requirements of the user. Any readymade software can be changed according to the needs and specifications of the user. However, the cost of installation of Customised softwares are high because the cost of change is to be paid by the user.
Advantages | Disadvantages |
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1. These softwares are designed to suit the specific requirements of the users. | 1. Cost of installation and maintenance is higher in comparison to ready to use Software. |
2. Level of Secrecy for the data is higher. | 2. Training requirement for using these packages is higher in comparison to ready to use Software. |
3. Linkage to other information systems is available on the basis of need of the enterprise. |
3) Tailor-made Software: The term 'tailor-made software' means developing a software according to the needs and specifications of the user. These softwares are not available off-the-shelf.
Advantages | Disadvantages |
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1. It being developed sccording to the specifications of the user, takes care of the specific needs of the enterprise. | 1. If the accounts are grouped in an innocent manner, the results will be misleading. |
2. The level of secrecy of data and authenticity checks are robust in such softwares. | 2. The cost of development and maintenance of such software is much higher in comparison to readymade or customised software. |
3. It is difficult to lern and require specialised training. | |
4. Training costs are high since they involve sophisticated applications. | |
5. If someone leaves the job, it becomes very difficult for the new employee to be fully conversant with such software. |
State the four basic requirements of a database applications.
‘Computerised Accounting Systems are best form of accounting system’. Do you agree? Comment.
Name the various categories of accounting package.
Define a computerised accounting system. Distinguish between a manual and computerised accounting system.
Database is implemented using ........
A sequence of actions taken to transform the data into decision useful information is called.......
‘Accounting software is an integral part of the computerised accounting system’ Explain. Briefly list the generic considerations before sourcing an accounting software.
The framework of storage and processing of data is called as ........
Give examples of two types of operating systems.
Give two examples each of the organisations where ‘ready-to-use’, ‘customised’, and ‘tailored’ accounting packages respectively suitable to perform the accounting activity.
Name any two types of commonly used negotiable instruments.
Why is it necessary to record the adjusting entries in the preparation of final accounts?
State the meaning of incomplete records?
What is ‘Depreciation’?
Briefly state how the cash book is both journal and a ledger.
State the meaning of a trial balance?
Define accounting.
State the different elements of a computer system.
Why is it necessary for accountants to assume that business entity will remain a going concern?
State the need for the preparation of bank reconciliation statement?
Voucher is prepared from:
(i) Documentary evidence
(ii) Journal entry
(iii) Ledger account
(iv) All of the above
A Trial balance is prepared:
(a) After preparation financial statement.
(b) After recording transactions in subsidiary books.
(c) After posting to ledger is complete.
(d) After posting to ledger is complete and accounts have been balanced.
What is a journal? Give a specimen of journal showing at least five entries.
What is the purpose of contra entry?
State the nature of accounting information required by long-term lenders.
Briefly explain the term ‘favourable balance as per cash book’.
When should revenue be recognised? Are there exceptions to the general rule?
What is contra entry? How can you deal this entry while preparing double column cash book?
The journal entry to record the sale of services on credit should include:
(a) Debit to debtors and credit to capital.
(b) Debit to cash and Credit to debtors.
(c) Debit to fees income and Credit to debtors.
(d) Debit to debtors and Credit to fees income.
Describe the advantages of sub-dividing the Journal.