RBSE Class 11 Accountancy Important Questions Chapter 1 Introduction to Accounting

Rajasthan Board RBSE Class 11 Accountancy Important Questions Chapter 1 Introduction to Accounting Important Questions and Answers. 

RBSE Class 11 Accountancy Important Questions Chapter 1 Introduction to Accounting

Very Short Answer Type Questions

Question 1. 
Which basis of accounting does not make a distinction between capital and revenue items?
Answer:
Cash basis.

Question 2. 
What is the nature of transactions recorded in the books of accounts?
Answer:
Monetary

Question 3. 
Name the document which support the happening of a transaction.
Answer:
Voucher

Question 4. 
What begins when the book keeping ends?
Answer:
Accounting

Question 5. 
What records the relevant transactions at one place relating to a person, assets, expense or revenue etc.? 
Answer:
Account.

Question 6. 
What is known as when the debts are owed by outsiders to a business firm?
Answer:
Debtor

Question 7. 
Name the term which is used to record the amount spent on production and sales of goods.
Answer:
Expense

Question 8.
Mention two branches of accounting apart from financial accounting.
Answer:
Cost Accounting and Management Accounting.

Question 9. 
State two limitations of accounting.
Answer:
Two limitations of accounting are: 
(a) Incomplete information, 
(b) Inexactness.

Question 10. 
Name two types of accounting information.
Answer:
Information on financial performance (profit/loss) and information of financial position (balance sheet).

Short Answer Type Questions

Question 1. 
Define accountancy. Mention two branches of accounting.
Answer:
Accountancy is a field of study which provides systematic knowledge of accounting concepts, principles and techniques. 
Branches of accounting:Cost Accounting and Management Accounting 

Question 2. 
What is accounting cycle? Name first two steps of accounting cycle.
Answer:
Accounting cycle is the sequence of steps involved in accounting process.
First two steps are:
(i) Identification of transaction and event.
(ii) Measurement of transitions and events.

Question 3. 
Differentiate between cash system of accounting and accrual system of accounting.
Answer:
The main difference between two systems of accounting depends upon timing of recognition of revenues and expenses. Under cash basis, revenues and expenses are recognised when they are actually received and paid whereas under accrual basis of accounting, revenues and expenses are recognised when they are earned or incurred irrespective of cash involvement. Accrual basis of accounting is most commonly used in real business world. 

Higher Order Thinking Skills Questions 

Question 1. 
Under which basis of accounting only cash transactions are recorded in the books? 
Answer:
Cash basis.

Question 2. 
What is accounting cycle?
Answer:
Accounting cycle is the sequence of steps involved in accounting process.

Question 3.
What is the relationship between book-keeping and accounting?
Answer:
Book-keeping is the basis of accounting while accounting processes the records provided by book-keeping.

Question 4.
What is accounting information?
Answer:
Accounting information is the end result of accounting in the form of statement of profit/loss and balance sheet.

Question 5.
Name the branch of commerce which keeps record of monetary transactions in a set of books.
Answer:
Book-keeping.

Question 6. 
Name the aspect of accountancy which consists of recording, summarizing, analysing, reporting and interpretation of end results to enable the users to take meaning decisions.
Answer:
Accounting.

Question 7.
Does accounting transactions of financial nature? Do you agree, give reason.
Answer:
Accounting records only those transactions which are monetary in nature but does not record any such information which cannot be measured in terms of money like relations of business firm with the employees and outside world.

Question 8.
Name two stakeholders who would be most interested in knowing portability and financial performance of a business firm?
Answer:
Creditors and Shareholders

Question 9.
You are the owner and running ‘Premna Apparels LLP’. You wish to borrow loan from the bank from the bank. Which type of financial records will be demanded by the bank from you.
Answer:
Financial Statements which will include Statement of Profit/Loss and Statement of Financial Position.

Question 10. 
Which qualitative characteristic is violated if accounting information is not clearly presented?
Answer:
Understandability. 

Multiple Choice Questions:

Question 1.    
The amount receivable by a business from the outsiders is known as ..............
(a) liabilities    
(b) expenses    
(c) loss    
(d) debtors
Answer:
(d) debtors

Question 2.    
The amount incurred to produce goods and make the services available is known as ..............    
(a) expense    
(b) income    
(c) revenue    
(d) expenditure
Answer:
(d) expenditure

Question 3.    
In Accounting, economic event is referred to ..............
(a) Bank    
(b) cash
(c) transaction    
(d) exchange of goods for money
Answer:
(c) transaction

Question 4.    
Features of accounting:
1. Classifying
2. Communication
3. Recording
4. Summarizing
5. Interpreting 
Choose the correct option
(a) 1,2,3,4,5    
(b) 2,4,3,5,1    
(c) 3,4,5,2,1    
(d) 3,1,4,2,5
Answer:
(d) 3,1,4,2,5

Question 5.    
Following is the steps of accounting process. Identify the step for which the accountants prepare financial statements?
(a) Identification of financial transactions    
(b) Recording of financial transactions
(c) Communicating the financial information    
(d) Interpreting the financial transactions
Answer:
(c) Communicating the financial information    

Question 6.    
Liabilities of an economic entity refers to
(a) resources    
(b) obligations    
(c) likely benefits    
(d) losses
Answer:
(b) obligations    

Question 7.    
Valued of stock of goods at the end of accounting year is ₹ 30,000. This is a    ...............
(a) transaction    
(b) event
(c) transaction as well as event    
(d) neither transaction not event
Answer:
(c) transaction as well as event    

Question 8.
Which of the following is not the sub-field of accounting?
(a) Bookkeeping    
(b) Financial Accounting
(c) Management Accounting    
(d) Cost Accounting
Answer:
(a) Bookkeeping    

Question 9.    
Which of the following is not the qualitative characteristic of accounting?
(a) Understanding
(b) Flexibility    
(c) Comparability    
(d) Reliability
Answer:
(b) Flexibility    

Question 10.    
Mr Ram deals in electronics items. Which of the following will not be recorded in the system of accounting?
(a) Purchase of machine on credit    
(b) Purchase of radio
(c) Payment of school fee from saving account    
(d) Sale of old newspapers used for visitors 
Answer:
(c) Payment of school fee from saving account    

II. State whether the following statements are true or false.

1. Book keeping is the part of financial accounting.
2. Accounting is a science as well as an art.
3.  Accounting and Accountancy are synomous terms.
4. Window dressing refers how beautifully the accounting information is presented.
5. Historical cost refers to the price paid to acquire the fixed assets.
6. Accounting ignores qualitative element like quality of workforce.
7. Accounting begins where book keeping ends.
8. Double entry book keeping is also known as financial accounting.
9. Rules of debit and credit are completely ignored in single entry system.
10. Financial statements are the end products of financial accounting.
Answers:    
1. True    
2. True    
3. False    
4. False    
5. True
6. True    
7. True    
8. True    
9. False    
10. True

III. Fill in the blanks with correct answer.

1.  Accounting is the    ............. of business.
2.  The amount invested by the proprietor is called ............. 
3.  Books keeping is the system of recording of .............  transactions in the books of accounts.
4.  Accounting begins where    ............. ends.
5.  Liabilities are the    ............. obligations of the businesses.
6.  Income is the difference between    ............. and expense.
7.  Single entry system is also known as accounts from ............. 
8.  Accounting comes under .............  sector of the economy.
9.  Accounting information is recorded on the basis of .............  costs.
10.  Accounting is affected by ............. dressing.
Answers:    
1. language    
2. drawings    
3. financial   
4. bookkeeping
5. Financial    
6. Revenue    
7. Incomplete records    
8. Service
9. Historical    
10. Window