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Introduction to Accounting — Account STD 11 Commerce — Question

CBSE BoardEnglish MediumSTD 11 CommerceAccountIntroduction to Accounting4 Marks
Question
“Only financial transactions are recorded in Accountancy.” Explain the statement.
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Answer

Only those transactions and events are recorded in accounting which are of a financial character. There are so many transactions in the business which are very important for business but which cannot be measured and expressed in terms of money and hence such transactions will not be recorded. For example, the quarrel between the Production Manager and the Sales Manager, resignation by an able and experienced manager, strike by employees and starting of a new business by the other competitor etc. Though these events affect the earnings of the business adversely but as no one can measure the effect of such events in terms of money, these will not be recorded in the books of the business.

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Raghav & Co. have two bank accounts, Account No. I and Account No. II. From the following particulars relating to Account No. I, find out the balance on that account on December 31, 2016 according to the Cash Book of the firm.
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2023

 

₹

June 20

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25

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