NCERT Solutions for Class 11 Accountancy Financial Accounting Part-1 Chapter 1

Introduction to Accounting Class 11

Chapter 1 Introduction to Accounting Exercise Solutions

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Short answers : Solutions of Questions on Page Number : 19

Q1 :  

Define accounting.


Answer :

Accounting is a process of identifying the events of financial nature, recording them in Journal, classifying in their respective ledgers, summarising them in Profit and Loss Account and Balance Sheet and communicating the results to the users of such information, viz. owner/s, government, creditors, investors etc.

According to the American Institute of Certified Accountants, 1941, "Accounting is an art of recording, classifying and summarising in a significant manner and in terms of money transactions and events that are, in part at least, of a financial character and interpreting the results thereof."

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Q2 :  

State what is end product of financial accounting?


Answer :

  1. Income statements (Trading and/or Profit and Loss Account)- An income statement that includes Trading and Profit and Loss Account, ascertains the financial results of a business in terms of gross (or net) profit or loss.

  1. Balance Sheet- It depicts the true financial positions of a business that provides required information like assets and liabilities of a business firm, to the users of accounting information like owners, creditors, investors, government, etc.

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Q3 :  

Enumerate main objectives of accounting.


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Q4 :  

List any five users who have indirect interest in accounting.


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Q5 :  

State the nature of accounting information required by long-term lenders.


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Q6 :  

Who are the external users of information?


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Q7 :  

Enumerate informational needs of management.


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Q8 :  

Give any three examples of revenues.


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Q9 :  

Distinguish between debtors and creditors.


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Q10 :  

'Accounting information should be comparable'. Do you agree with this statement? Give two reasons.


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Q11 :  

If the accounting information is not clearly presented, which of the qualitative characteristic of the accounting information is violated?


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Q12 :  

The role of accounting has changed over the period of time"- Do you agree?

Explain.


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Q13 :  

Giving examples, explain each of the following accounting terms:

  • Fixed assets

  • Gain

  • Profit

  • Revenue

  • Expenses

  • Short-term liability

  • Capital


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Q14 :  

How will you define revenues and expenses?


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Q15 :  

What is the primary reason for the business students and others to familiarise themselves with the accounting discipline?


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Long answers : Solutions of Questions on Page Number : 20

Q1 :  

Explain the factors, which necessitated systematic accounting.


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Q2 :  

Describe the brief history of accounting.


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Q3 :  

Explain the development of and role of accounting.


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Q4 :  

Define accounting and state its objectives.


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Q5 :  

Describe the informational needs of external users.


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Q6 :  

What do you mean by an asset and what are different types of assets?


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Q7 :  

Explain the meaning of gain and profit. Distinguish between these two terms.


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Q8 :  

Explain the qualitative characteristics of accounting information.


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Q9 :  

Describe the role of accounting in the modern world.


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Next Chapter 2 : Theory Base of Accounting >>

Financial Accounting Part-1 - Accountancy : CBSE NCERT Exercise Solutions for Class 11th for Introduction to Accounting will be available online in PDF book form soon. The solutions are absolutely Free. Soon you will be able to download the solutions.

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