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1. The Process of doing the total of both side of Debit and Credit of an Account is called as ?

Ans. The process of doing total for both of the sides of an Account is called as Casting of an Account.

2. What is rule for Nominal Account ?     CBSE CLASS 12 ACCOUNTS SAMPLE PAPER

Ans. The Rule of the Nominal Account is Debit all the Expenses and Loses and Credit all the gains and incomes.

3. Write short comment on functionality of a Computer.

Ans. A computer is a Electronic Machinery which calculates the equations automatically on basis of the software which is written program with set of defined rules by a program or specialist.

4. Creditors are the external or internal users of the financial statement?

Ans. External Users

5. What do you mean by a Business transaction?

Ans. A business transaction means it can be measured in terms of Money.

6. Give an example of Documentary Evidence.

Ans. Voucher is example of documentary evidence.

7. What do you mean by Bad Debts?

Ans. When a receivable amount become not possible to receive by the person who owes it is referred as Bad Debts.

8. Define the term “Purchase Return”.

Ans. When a purchase is returned back in whole or in some part is called or referred as Purchase Return to its supplier or vendor, in other words we can explain that  the goods delivered are not up to the mark or totally different from the goods which were ordered most of the time it’s happened due to negligence of the supplier or may be by other reason. An Organization is not in position to keep the defaulted goods, so its returns it to the supplier, the part of the returned goods is considered as the Goods or Purchase Returned.

9. Describe the main features of the Trial Balance.

Ans. Trial Balance is the summary of the ledger accounts.

Its not the final statement but its is source to prepare the final Statement.

Its for the Check the arithmetical accuracy of the Accounts.

It’s the base of preparing the final statements.

10. Define the Bank Reconciliation Statement.

Ans. In simple words the statement which is prepare to reconcile the differences between Balances of Bank in Cash Book and Bank Book is referred as Bank Reconciliation Statement.

11. What are the Rectifications of the Errors?

Ans. Procedure to find out the errors and then rectify them in proper manner to make the accounts book accurate is called the Rectification of Errors.

12. Explain that how the Creditors can be benefited with Financial Statements.

Ans. Creditors are the companies or persons who sale their goods on Credit to organization or firm or enterprises simply to their customers, they want their money should be recovered fast and safely creditors needs their money to be safe in respect of the financial statement, a creditor can see the financial result and can easily assume the profit or financial position of the organization in future, so he can decide whether he should do the business with that organization or not.

13. Explain some Disadvantages of Single Entry system with example.

Ans. Few disadvantages can be considered under the Single Entry System like since there is no Financial statements are prepared like Trial Balance to one cannot determine the accuracy lying the books of account or not. It cannot fetch any proved or beneficial information to the external or internal users of the organization. Assets under this system are not kept as accounted to there is always uncertainly regarding usage of the Assets by the organization is proper or improver.

14. Record the following Journal Entries under Personal, Real and Nominal Accounts Principles.

a) Mr Mehta was paid Rs. 15000 in cash and Rs. 25000 by Cheque for writing off his account.

b) Firm purchased an industrial plant to commence a new product unit for Rs. 10 Lakhs.

c) Scraps of Rs. 5000 sold.

Ans.                                   JOURNAL

  Particulars LF Dr Cr
a) Mr Mehta
To Cash
To Bank A/c

b) Industrial Plat
To Bank A/c

c) Cash Account A/c
To Misc Income A/c











15. Why A Not-For-Profit Organization maintains Receipt and Payments Account in addition of preparing the Cash book?

Ans. Cash book is a book where all Cash basis transactions take places on Date of Entry basis, they are in raw form, one cannot take any decision on behalf of Cash book because it doesn’t show any result, the need the of Receipt and Payment Account is felt as it is summary of the Cash payments and cash receipt during the accounting year.

16. Prepare a Bank Reconciliation Statement on the base of the following transactions and facts.

A) A Bank Balance as per Cash Book is Rs. 7700 (Posivite)

B) A Cheque was issued to Talwar and Co. for Rs. 1200 was not presented in bank till date.

C) A Bank Interest Rs. 220 was credited by bank

D) Cheque book issue charges debited by Bank Rs. 100

E) The balance as per Bank Passbook is Cr Rs. 9020

As on 31st March 2010

 Particulars Plus Figures Minus Figures
 Balance As per Cash Book

Add: Cheques Issued but not presented in bank or payment
Bank Interest credited by Bank

Less: Bank charges for Cheque Book issue is debited by bank

Balance as per Pass Book (Cr)



















17. What would be the suitable classification for the following Accounts

A) FixedAssetsSold
B) Plant and Machinery

Ans. NominalA/c
Real Accounts

18. If there is some increase in the following transaction which side for it will be recorded? Explain with suitable example.

2. Interest Payable

Ans. 1.Debit–ReceivableCurrentAssetsA/c
2. Credit- Interest Payable

19. Enter the following transactions in a Single column Cash Book of Rosemerry House

April 1 Cash In Hand                                 Rs.   7720
April 15 Cash paid to Flowers Pots           Rs.   1750
April 19 Cash paid for Rose Flowers         Rs.   1150
April 29 Donation made in Cash               Rs.    2100
April 30 Cash withdrawn from Bank         Rs.   12500

Ans.                          Rosemerry House
Dr.                                CASH BOOK                                                Cr.

 Date Particulars L.F. Rs. Date Particulars L.F. Rs.
1 Apr To  Balance b/d


15 Apr By Flower Pots A/c


30 Apr To  Bank Account


19 Apr By Flower Purchase A/c


29 Apr By Donation A/c


30 Apr By Balance c/d


20. In respect of Financial Accounting system state any two differences between Capital Expenditure and Revenue Expenditure.

Ans. Capital Expenditure is incurred in order to acquire the Assets which help an organization to run its business and Revenue Expenses are those expense which are incurred to carry a business on day to day basis.

Capital Expenses adds the efficiency to the Business while Revenue Expenses are incurred in order to bring the profitability to the organization.

21. How a Bill of Exchange is Endorsed?

Ans. A Bill of exchange can be endorsed in a specified way, as we know that the whole purpose of raising a bill of exchange by a seller is to get the payment for goods he has sold to the drawee of the Bill. Seller always mentions the person or Bank to whom the payment should be made and seller will get the payment from the Bank after realization of the payment by the drawee. This transfer of the bill in name of the Bank is called the Endorsement of the Bill; the person is whose name the Bill is transferred referred as Endorser and the person who has transfer the bill in name of Endorser if called the Endorsee.

22. Fill in the blanks

a) Recording only _______ transactions are the main feature of Money Measurement Principle.

b) Under _____ concept assets are recorded at cost Base only.

c) ________ Concept says that a business organization will not be shut down in near future.

d) Under the _______Concept the both debit and credit should be equal in total amount.

Ans. a)Financial
d) Dual Aspect Concept.


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