Class 11 Accountancy Important Chapter 4 Recording of Transactions – II

Class 11 Accountancy Important Chapter 4 Recording of Transactions – II Solutions English Medium As Per AHSEC New Syllabus to each chapter is provided in the list so that you can easily browse through different chapters ASSEB Class 11 Accountancy Important Solutions and select need one. AHSEC Class 11 Accountancy Additional Notes English Medium Download PDF. HS 1st Year Accountancy Important Solutions in English.

Class 11 Accountancy Important Chapter 4 Recording of Transactions – II

Also, you can read the NCERT book online in these sections Solutions by Expert Teachers as per Central Board of Secondary Education (CBSE) Book guidelines. ASSEB Class 11 Accountancy Additional Question Answer are part of All Subject Solutions. Here we have given HS 1st Year Accountancy Important Notes in English for All Chapters, You can practice these here.

Recording of Transactions – II

Chapter: 4

IMPORTANT QUESTION AND ANSWER

Short Question and Answer:

1. What is the primary difference between a Single Column Cash Book and a Double Column Cash Book?

Ans: (i) A Single Column Cash Book records only cash transactions, whereas a Double Column Cash Book records both cash and bank transactions.

(ii) The Double Column Cash Book helps manage a business with numerous bank transactions, reducing the need for separate bank ledger accounts.

(iii) The Single Column Cash Book is simpler but only tracks cash receipts and payments.

2. Explain how a business records cash receipts and payments in the Cash Book.

Ans: (i) Cash receipts are recorded on the debit side, including cash received from customers or other sources.

(ii) Cash payments are recorded on the credit side, such as payments for expenses, purchases, or salaries.

(iii) At the end of the period, the balance is calculated by subtracting payments from receipts, showing the cash balance.

3. How does the system of Petty Cash Book benefit an organization?

Ans: (i) It reduces the burden on the chief cashier by delegating the responsibility of small, routine payments to the petty cashier.

(ii) It provides better control over minor expenses and avoids cluttering the main Cash Book with small payments.

(iii) It helps in managing and tracking miscellaneous expenses more effectively.

4. Why are special purpose books like the Purchases Book and Sales Book necessary in accounting?

Ans: (i) Special purpose books help streamline accounting by categorizing repetitive transactions such as purchases and sales.

(ii) They reduce errors in recording and make posting to the ledger more efficient.

(iii) These books also improve the accuracy of financial statements by ensuring consistent and organized transaction recording.

5. What is the purpose of using the Journal Proper in accounting?

Ans: (i) The Journal Proper is used to record irregular or infrequent transactions that do not fit into other special journals.

(ii) It is essential for recording opening entries, closing entries, adjustments, and corrections to previously recorded transactions.

(iii) The Journal Proper ensures that no financial event is missed in the accounting records.

6. Explain the process of posting from the Sales Journal to the ledger.

Ans: (i) Sales transactions are recorded in the Sales Journal, which includes the date, customer name, invoice number, and amount.

(ii) The total value of credit sales is posted to the Sales account in the ledger, while individual customer accounts are updated daily.

(iii) This process helps track sales and accounts receivable efficiently.

7. What is the role of contra entries in a Double Column Cash Book?

Ans: (i) Contra entries indicate transactions where cash is transferred to or from the bank.

(ii) In a Double Column Cash Book, these entries are recorded in both the cash and bank columns, without affecting the ledger accounts.

(iii) They provide clarity on cash and bank movement within the business.

8. Why is it necessary to balance the Cash Book periodically?

Ans: (i) Balancing the Cash Book helps ensure that all cash receipts and payments have been recorded accurately.

(ii) It helps identify errors or discrepancies in the recording process, ensuring that the business maintains correct financial records.

(iii) It provides an up-to-date cash balance, allowing for better financial management and decision-making.

9. Describe the posting process from the Purchases Return Journal to the ledger.

Ans: (i) Purchases returns are recorded in the Purchases Return Journal with the supplier’s name, debit note number, and the amount of goods returned.

(ii) The supplier’s account is credited with the amount of the return, reducing the outstanding balance.

(iii) The total returns are posted to the Purchases Return account in the ledger.

10. How does a business handle dishonoured cheques in the Cash Book?

Ans: (i) When a cheque is dishonoured, the business debits the bank column in the Cash Book for the dishonoured amount.

(ii) The name of the customer is recorded in the particulars column, and the transaction is reversed.

(iii) The dishonoured cheque restores the previous balance, indicating that the amount is no longer available for use.

11. What is the advantage of maintaining a Petty Cash Book under the Imprest system?

Ans: (i) The Imprest system ensures that a fixed amount of cash is provided to the petty cashier for small expenses, simplifying cash flow management.

(ii) It allows for periodic reimbursements, ensuring that the petty cashier always has enough funds to cover small payments.

(iii) It also provides greater control over small expenses, reducing the risk of mismanagement or fraud.

12. How do businesses manage credit sales using the Sales Journal?

Ans: (i) The Sales Journal records all credit sales, including the date, customer name, invoice number, and the total sale amount.

(ii) Each transaction is posted to the respective customer’s account, ensuring accurate tracking of accounts receivable.

(iii) The total credit sales for the period are posted to the Sales account in the ledger.