BBA 1st Semester Short Question Answer Bookkeeping 2018 2019
BBA 1st Semester Short Question Answer Bookkeeping 2018 2019 :- In this article you can find related to bookkeeping and bookkeeping question answer and study materials of latest version and other site link like as fundamental of management , principle of economics, business mathematics and all subject of bba all semester. B.b.a latest news all information link you can find . thanks to coming our site and get latest news related to business and BBA.If we talk about BBA then Bookkeeping and Accounting is one of the most important Topic. Bookkeeping is common to all semesters Here we are presenting BBA Bookkeeping and Accounting Study Material and Notes for all Semesters. BBA Bachelor of Business Administration in Bookkeeping and Accounting notes study material in this website cyberpoint9.com/testing most important chapter and Question paper BBA notes in this page more links to BBA notes and study material and question paper mock paper. BBA in accounting and finance is an undergraduate commerce course. bba study in bookkeeping and accounting, financial planning, economics, business organisation and other similar areas of operation in any business organisation. full BBA course three year degree course consists of Six semesters. the basic eligibility criterion for BBA dgree is qualifying 10+2 or equivalent examination in any stream from a recognized board of the country.Bachelor of Business Administration (BBA) in Accounting programs combine the fundamentals of a business program with concentrated coursework in accounting. Find out what these programs entail and what students do after graduation.bba subject bookkeeping and accounting chapter wise notes study material, question paper, mock paper, sample paper, in this website study point to bba notes. BBA 1st Semester Short Question Answer Bookkeeping 2018 2019
Q.1. Give the Reasons of Necessity for Bookkeeping.
Ans. Bookkeeping has become necessary, due to the following reasons :
- Necessary Information : A Trader cannot remember every transaction of it business for a long time, In the absence of it he cannot get the necessary information.Thus in order to prevent frauds, errors and wastes & to keep supervision over the business activities the proper account should be maintained by the trader.
- Ascertaining Sales Price : Whenever the existing business is to be sold the sale price of the business can easily be ascertained if correct bookkeeping records are maintained.
- Payment of Income Tax : If proper and satisfactory accounts are not maintained, the correct, assessments of tax will not be possible. Therefore to make the payment of Income Tax, proper accounts are to be maintained.
- Insolvency cost : At the time of insolvency, the cost may deal the cases leniently if proper accounts are maintained.
- Complete Record : It keeps a complete record of such transactions.
- Check On Arithmetical Accuracy : It provides a check on the arithmetical accuracy of the books of account.
- Details Available : With the help of these accounts, details with regards to any account are easily available.
- Frauds are Detected : Since the system is very much scientific the chances of fraud are minimized.
- Profit and Loss be Ascertained : With the help of it, profits or losses can easily be as curtained.
- Balance Sheet : A balance sheet can easily be prepared at any time showing the actual amount of capital invested and the assets and liabilities.
Q.2. Write a short note on “Bookkeepings is a science or an Art”.
Ans. Bookkeeping is a science as well as an art. Science is a knowledge and art is an action. Principles of keeping the record is a science, and actual keeping of records is an art. Thus without having through grounding in the principles of accountancy, nobody can become an efficient bookkeeper.
Bookkeeping is only a means to an end being the ascertainment of the financial position of the concern, special emphasis has to be given on the study of the principles of bookkeeping. The Books of accounts are the tools, and in order to be a skillful worker. The book keeper must be fully acquainted with his tools. Hence, Bookkeeping is a science as well as an art also.
Q.3 What down the essential features of accounting principles.
Ans. The ledger is know as the principal book because it contains the contains the accounts showing the results of various transactions. The accounts are prepared on the basis of the basis of the cash book, the purchase book, the sales book, the journal etc. Transactions are first entered in these books and then on their basis, ledger accounts are written up. These books are known as subsidiary books. They are also knows as books of primary entry. Subsidiary books, therefore, may be defined as books where transactions are first entered and Properly Classified. The cash book is a subsidiary book because cash transactions are first entered here. But it is also a principle book because it Shows the balance at bank and the cash in hand. Final results of carrying on business cannot be ascertained without considering cash in hand and at bank.
Q.4. What are the basic principles of Accounting ?
Ans. In addition to the basic assumption, accounting has to develop the following basic principles :
- Dual Aspect (2001, 04) : According to this principle, “Every business transaction has double effect. There are two sides of every transaction. This is evident when we study the accounting terms like assets, capital and liabilities”.
The system of recording transactions based on principle is called as double entry system. The relationship between assets, liabilities and capital is at present known as accounting equation which can also be expressed as under :
Assets = Capital + Liabilities
Or Capital = Assets + Liabilities
Or Liabilities = Assets – Capital
We record all the business transactions on the basis of dual aspect and call the system as double entry system.
- Verifiability— Objectivity and Evidence : This principle of verifiable of objectivity means that every business record must be based and supported by documentary evidence. We do not pass any entry or make any posting in subsidiary books unless there is a voucher for it. Receipts, bills, invoices, cash memos, salary bills and deeds are some of the vouchers used a documents for recording business transaction.
According to the principles of objectivity, accounting should be definite, verifiable and free from manipulation and personal bias.
- Historical Cost : According to the historical cost principles, “All business transactions must be recorded in the books of accounts at their monetary cost of acquisition. This principle is called historical, because the balance of assets and liabilities is carried forward from year to year at its acquisition cost, irrespective of increase or decrease in the market value of assets.
e.g. an asset is purchases for ₹ 6,00,000 and if at the time of preparing final accounts, its market value is say ₹ 4,00,000 or 7,00,000 yet it will be recorded on the basis of its purchase price ₹ 6,00,000.
- Revenue Recognition Principles : In accounting terminology ‘revenue’ is the amount received or receivable from the sale of goods. The principles explain when we should assume some revenue to have been earned. It will enable us to identify the period for which the revenue has been earned. According to the accounting period assumption revenue must be concerned with the specific accounting period. We can determine the revenue as realized on the sales basic, cash basis and production basis.
- Matching Concept (2004,06) : This is based on the accounting period concept. The principle objective of running a business is to earn profit. In order to determine the profit made by the business during a period, it is necessary that revenue of the period should be matched with the costs for the period. Thus the matching principle holds the Expenses should be recognized in the same period as associated revenue.
e.g. if goods costing ₹ 20,000 are sold for ₹ 30,000 and it is reasonably certain that revenue will be realized, then ₹ 20,000, i.e. cost of sales should be matched with revenue to give net result of ₹ 10,000 as profit.
Q.5. What are the limitations of Accounting ?
Ans. Accounting has the following limitations :
- Incomplete Information : Accounting records only those transactions which are of financial nature. It Records only the quantitative aspect of our transaction These Accounting cannot record the non-financial transaction. Such as change in economic, government policy, competition in the market etc. are not recorded in accounting, though they affect the financial soundness of the business.
- Inexactness : Accounting calculate profit or loss of the business on the basis of real and assumed estimation. Accounting makes the valuation of stock, determine the method of depreciation and maintain various reserves and provision in any way they like. Different firms adopt the different methods, so the result of the business will change with the change in practice.
- Representing Valueless Assets : There are certain assets which do not have real value but they are shown in our balance sheet. These assets are patents, trademark, goodwill, discount on issues of shares etc. As such the financial analysis based on past events has to be suitably modified before it can be used for forecasting.
- Unsuitable for Forecasting : Financial accounting are only a record of past data, whereas continuous changes take place in the demand of the product, position of competition, consumer performance etc. As such the financial analysis based on past events has to be suitably modified before it can be used for forecasting.
- Manipulation ; Accounting results are based upon the information supplied to it. The management may be based and feed manipulative information to prove its point of view. Accounting can show the result of business, as desired by the owners of the business.
- Not free from Bias : In many situations, the account has to exercise his personal judgement and make a choice out of various alternative available, e.g. choice in the method of depreciation, FIFO, LIFO etc. Thous, Accounting is not free from bias.
- Ignorance about the Present Value of Business : While maintaining books of accounts we follow going concern concept, i.e, the business will be carried on for indefinite period. With this purpose show the value of our assets in the balance sheet at its books value not the market value. So, accounting in this way, fail to show the present sale value of the Business.