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Principles-of-accounting Chapters

12th Class Chapter 1 Principles of accounting Short Questions

An important facility for 12th class students preparing for short questions principles of accounting 12th class chapter 1 of BISE. Get hundreds of questions to prepare and get better marks in 12th principles of accounting
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Question: 1
What is meant by single entry system?
Answer: 1
1-17
Under single entry system sometimes both aspects of transactions are recorded sometimes only one aspect of transaction is recorded and sometimes no aspect of transaction is recorded.
Question: 2
What is opening statement of affairs?
Answer: 2
2-17
The opening statement of affairs is prepared to find out the opening capital under single entry system.
The formula to calculate opening capital is given below
Opening Capital =Closing capital -increse in capital
Question: 3
What is meant by profit or loss statement?
Answer: 3
3-17
Profit or loss statement is prepared to find out the profit or loss of the year under single entry system.
Question: 4
Define pure entry system.
Answer: 4
4-17
Under pure entry system ,only person accounts are kept,Real and nominal accounts recorded are not maintained.
Example Mr Ali opened his account with Rs 500
Question: 5
What is meant by double entry system?
Answer: 5
5-17
A system in which two sides of every transactions are recorded is called double entry system.
Question: 6
What is closing capital?
Answer: 6
6-17
The money or capital which is net at the ending or closing of the year or opening of the year.
Question: 7
Define Balance Sheet.
Answer: 7
7-17
Balance Sheet is prepared to find out the financial position of business under double entry system.
Question: 8
What is meant by statement of affairs?
Answer: 8
8-17
Statement of affair is a sort of balance sheet.It have assets on left side an liabilities and capital on the right side under single entry system.
Question: 9
What is a net worth method?
Answer: 9
9-17
Net worth method is a way which is used to measure the profit in single entry system.The formula of calculating profit under the net worth method is
Profit of year-Increase in capital -Legacy
Question: 10
What is Drawing?
Answer: 10
10-17
Cash or goods taken away by the owner from the business to personal is called Drawing.
Example : Salman withdraw cash for his personal use from business.
Question: 11
What is meant by Additional Capital?
Answer: 11
11-17
The amount of capital which is introduced during the year in the business is called additional capital or fresh capital.
Question: 12
What is opening capital?
Answer: 12
12-17
Opening Capital is the capital or money which is met at the beginning or opening of the year.
Question: 13
Write down two advantage of single entry system?
Answer: 13
13-17
Two advantage or characteristics of single entry system are as fellow
1.It is useful for small business.
2.In this system sole properties is free from danger or frauds.
Question: 14
Write down the basic equation of Balance Sheet.
Answer: 14
14-17
Balance Sheet is used to calculate Capital or Money.
Equation: The basic equation of balance sheet is given below
Assets= Liabilities & Capital
Question: 15
What is Ending Statement of affairs?
Answer: 15
15-17
The ending statement of affairs is prepared to find out the ending capital under single entry system.
Question: 16
Write any three demerits of single entry system?
Answer: 16
16-17
Three demerits or disadvantages of single entry system as as under:
1.Under this system only partial and in complete record kept.
2.Nominal accounts are not maintained.
3.Real accounts are not maintained,
Question: 17
What is difference between balance sheet and statement of affairs?
Answer: 17
17-17
Balance Sheet: Balance Sheet is prepared to find out the financial position of business under double entry system.

12th Class Principles-of-accounting Chapters Short Questions