Question
Give any three reasons for keeping records under Single Entry System.
✓
Answer
Reasons:
- Simple Method: Single Entry System is a simple method of recording business transactions.
- Less Expensive: It is less expensive when it is compared to Double Entry System of book keeping.
- Suitable for Small Businesses: It is mainly suited to small businesses with limited number of transactions and very few assets and liabilities.
- No Need of Expert Knowledge of Principles of Book Keeping: Under Single Entry System, accounting records can be easily maintained as their maintenance does not require expert knowledge of the principles of book keeping.
- Easy to Ascertain Profit or Loss: Ascertainment of profit or loss is much easier. To ascertain the profit or loss, the proprietor has to compare the financial condition of business at the close of the accounting period with that in the beginning.
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2018
|
|
₹
|
|
Sept. 1
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Cash in Hand
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7,500
|
|
|
Bank Overdraft
|
3,500
|
|
Sept. 2
|
Paid Wages
|
200
|
|
Sept. 5
|
Cash Sales
|
7,000
|
|
Sept. 10
|
Cash Deposited into Bank
|
4,000
|
|
Sept. 15
|
Goods Purchased and Paid by Cheque
|
2,000
|
|
Sept. 20
|
Paid Rent
|
500
|
|
Sept. 25
|
Drew from bank for personal use
|
400
|
|
Sept. 30
|
Salary Paid
|
1,000
|