Class 11 Accountancy - Chapter Theory Base of Accounting NCERT Solutions | Choose the Correct Answer During the

Complete the following work sheet:
(i) If a firm believes that some of its debtors may ′default′, it should act on this by making sure that all possible losses are recorded in the books. This is an example of the ___________ concept.
(ii) The fact that a business is separate and distinguishable from its owner is best exemplified by the ___________ concept.
(iii) Everything a firm owns, it also owns out to somebody. This co-incidence is explained by the ___________ concept.
(iv) The ___________ concept states that if straight line method of depreciation is used in one year, then it should also be used in the next year.
(v) A firm may hold stock which is heavily in demand. Consequently, the market value of this stock may be increased. Normal accounting procedure is to ignore this because of the ___________.
(vi) If a firm receives an order for goods, it would not be included in the sales figure owing to the ___________.
(vii) The management of a firm is remarkably incompetent, but the firms accountants can not take this into account while preparing book of accounts because of ________ concept.

Discuss the concept-based on the premise do not anticipate profits but provide for all losses.

When should revenue be recognised? Are there exceptions to the general rule?

Fill in the correct word:
1. Recognition of expenses in the same period as associated revenues is called _______________concept.
2. The accounting concept that refers to the tendency of accountants to resolve uncertainty and doubt in favour of understating assets and revenues and overstating liabilities and expenses is known as _______________.
3. Revenue is generally recognised at the point of sale denotes the concept of _______________.
4. The _______________concept requires that the same accounting method should be used from one accounting period to the next.
5. The_______________concept requires that accounting transactions should be free from the bias of accountants and others.

The accounting concepts and accounting standards are generally referred to as the essence of financial accounting. Comment.

Why is it necessary for accountants to assume that business entity will remain a going concern?

What is the money measurement concept? Which one factor can make it difficult to compare the monetary values of one year with the monetary values of another year?

What is matching concept? Why should a business concern follow this concept? Discuss?

Why is it important to adopt a consistent basis for the preparation of financial statements? Explain.

What is the basic accounting equation?

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?

State the four basic requirements of a database applications.

Define accounting.

State the different elements of a computer system.

State the need for the preparation of bank reconciliation statement?

Trial balance is:

(a) An account.
(b) A statement.
(c) A subsidiary book.
(d) A principal book.

Double column cash book records:
(i) All transactions
(ii) Cash and bank transactions
(iii) Only cash transactions
(iv) Only credit transactions

What are the possible reasons for keeping incomplete records?

Match the items given under ‘A’ with the correct items under ‘B’
(i) Closing stock is credited to                                                  (a) Trial balance
(ii) Accuracy of book of account is tested by                            (b) Trading account
(iii) On returning the goods to seller, the buyer sends              (c) Credit note
(iv) The financial position is determined by                              (d) Balance sheet
(v) On receiving the returned goods from the                          (e) Debit note
buyer, the seller sends

Distinguish between a ‘ready-to-use’ and ‘tailored’ accounting software.

Distinguish between capital and revenue expenditure and state whether the following statements are items of capital or revenue expenditure :
(a) Expenditure incurred on repairs and whitewashing at the time of purchase of an old building in order to make it usable.
(b) Expenditure incurred to provide one more exit in a cinema hall in compliance with a government order.
(c) Registration fees paid at the time of purchase of a building.
(d) Expenditure incurred in the maintenance of a tea garden which will produce tea after four years.
(e) Depreciation charged on a plant.
(f) The expenditure incurred in erecting a platform on which a machine will be fixed.
(g) Advertising expenditure, the benefits of which will last for four years.

Write two points of distinction between bills of exchange and promissory note.

An appropriate accounting software for a small business organisation having only one user and single office location would be ........

Explain basic factors affecting the amount of depreciation.

State the causes of difference occurred due to time lag.