Tag: meaning, definition, need, objectives and limitations of double entry system

Questions Related to meaning, definition, need, objectives and limitations of double entry system

Which system of accounts recognizes the fact that every transaction has two aspects and records both aspects of each and every transaction?

commercial applications meaning and fundamentals of double entry book-keeping double entry system meaning, definition, and advantages of double entry book-keeping meaning, definition, need, objectives and limitations of double entry system introduction to single entry system and difference between single entry and double entry system meaning and featuresof incomplete records

  1. Single entry system

  2. Double entry system

  3. Double account system

  4. Duplicate account system

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Correct Option: B
Explanation:

On the other hand, the double entry system is based on scientific principles and is, therefore, used by most of the business houses. 

The system recognizes the fact that every transaction has two aspects and records both aspects of each and every transaction.

Which of the following is/are merit of double entry system?

commercial applications meaning and fundamentals of double entry book-keeping double entry system meaning, definition, and advantages of double entry book-keeping meaning, definition, need, objectives and limitations of double entry system introduction to single entry system and difference between single entry and double entry system meaning and featuresof incomplete records

  1. It keeps a complete record of business transactions.

  2. It provides a check on arithmetical accuracy of accounts

  3. The detailed profit and loss account can be prepared to show profits earned or loss suffered during any given period.

  4. All of the above

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Correct Option: D

As per the provisions of the Companies Act, 2013, companies must maintain their accounts under __________________.

commercial applications meaning and fundamentals of double entry book-keeping double entry system meaning, definition, and advantages of double entry book-keeping meaning, definition, need, objectives and limitations of double entry system introduction to single entry system and difference between single entry and double entry system meaning and featuresof incomplete records

  1. Double account system

  2. Single entry system

  3. Double entry system

  4. Duplicate account system

Show answer
Correct Option: C
Explanation:

Companies Act, 2013 requires every company to keep and maintain at its registered head office books of accounts and relevant documents and the financial statements for each FY (financial year) that provides a true and fair picture of the company's state of affairs which includes its branch offices and other offices.

If salary is given to proprietor ___________.

commercial applications meaning and fundamentals of double entry book-keeping double entry system meaning, definition, and advantages of double entry book-keeping meaning, definition, need, objectives and limitations of double entry system introduction to single entry system and difference between single entry and double entry system meaning and featuresof incomplete records

  1. Proprietors salary account is debited

  2. Capital account is credited

  3. Both a & b

  4. None of the above

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Correct Option: C

When the final accounts are being prepared for a firm in respect of adjustments __________________.

commercial applications meaning and fundamentals of double entry book-keeping double entry system meaning, definition, and advantages of double entry book-keeping meaning, definition, need, objectives and limitations of double entry system introduction to single entry system and difference between single entry and double entry system meaning and featuresof incomplete records

  1. Double entry should be made

  2. Double entry not required

  3. Should appear only in balance sheet

  4. None of the above

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Correct Option: A

Double Entry principle means __________________.

commercial applications meaning and fundamentals of double entry book-keeping double entry system meaning, definition, and advantages of double entry book-keeping meaning, definition, need, objectives and limitations of double entry system introduction to single entry system and difference between single entry and double entry system meaning and featuresof incomplete records

  1. Writing all entries twice in the book

  2. Having debit for every credit and similarly, credit for every debit

  3. Maintaining the double account for each business transactions

  4. Writing two times the same entry

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Correct Option: B
Explanation:

Real account is an record of an asset. An asset can be current asset such as cash, a fixed asset such as building and intangible asset such as goodwill. Real account relate to the assets & liabilities of a business.

The correct concept of double entry book keeping states that ____________________.

commercial applications meaning and fundamentals of double entry book-keeping double entry system meaning, definition, and advantages of double entry book-keeping meaning, definition, need, objectives and limitations of double entry system introduction to single entry system and difference between single entry and double entry system meaning and featuresof incomplete records

  1. For every goods received on credit, the seller becomes your creaditor

  2. For every debit entry, there must be a corresponding credit entry

  3. For every seller, there must be a buyer

  4. One party receives and another party give value

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Correct Option: B

The accounting entries for recording Rs.10,00,000 cash introduced by the owner of a business is ______________.

commercial applications meaning and fundamentals of double entry book-keeping double entry system meaning, definition, and advantages of double entry book-keeping meaning, definition, need, objectives and limitations of double entry system introduction to single entry system and difference between single entry and double entry system meaning and featuresof incomplete records

  1. Debit Cash account and Credit Capital account

  2. Debit Cash account and Credit Investment account

  3. Credit Cash account and Debit Investment in business account

  4. Credit Cash account and Debit Owner's account

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Correct Option: A

When a liability is reduced or decreased, it is recorded on the ______________.

commercial applications meaning and fundamentals of double entry book-keeping double entry system meaning, definition, and advantages of double entry book-keeping meaning, definition, need, objectives and limitations of double entry system introduction to single entry system and difference between single entry and double entry system meaning and featuresof incomplete records

  1. left or credit side of the liability account

  2. right or debit side of the liability account

  3. right or credit side of the liability account

  4. left or debit side of the liability account

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Correct Option: D
Explanation:

Since the Liability shows credit balance as per the accounting equation. When a liability is reduced or decreased, it is recorded on the debit side of the liability account.

Double entry in cash book is completed when _________________.

commercial applications meaning and fundamentals of double entry book-keeping double entry system meaning, definition, and advantages of double entry book-keeping meaning, definition, need, objectives and limitations of double entry system introduction to single entry system and difference between single entry and double entry system meaning and featuresof incomplete records

  1. Salaries are paid by cheque

  2. Withdrawal of money from bank for personal use

  3. Deposited cash into bank

  4. None of these

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Correct Option: C
Explanation:

Option C is correct.

Deposited cash into bank Entry will be :-      Bank A/c Dr.
                                                                          To Cash A/c

Deposited cash into bank has effect on both Cash & Bank A/c.