NCERT Class 11 Financial Accounting-I Chapter 1 – English Medium | Class 11 Financial Accounting-I “Introduction to Accounting” Solution in English |

Might Learn 7

Introduction to Accounting

  1. Define accounting.

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  1. State the end product of financial accounting.

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  1. Enumerate main objectives of accounting.

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  1. Who are the users of accounting information.

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  1. State the nature of accounting information required by long-term lenders.

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  1. Who are the external users of information?

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  1. Enumerate information needs of management.

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  1. Give any three examples of revenues.

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  1. Distinguish between debtors and creditors; profit and gain

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  1. ‘Accounting information should be comparable’. Do you agree with this statement. Give two reasons.

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  1. If the accounting information is not clearly presented, which of the qualitative characteristic of the accounting information is violated?

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  1. “The role of accounting has changed over the period of time”- Do you agree? Explain. 13. Giving examples, explain each of the following accounting terms :
  • Fixed assets • Revenue • Expenses • Short-term liability • Capital

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  1. Define revenues and expenses?

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  1. What is the primiary reason for the business students and others to familiarise themselves with the accounting discipline?

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Long Answers

  1. What is accounting? Define its objectives.

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  1. Explain the factors which necessitated systematic accounting.

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  1. Describe the informational needs of external users.

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  1. What do you mean by an asset and what are different types of assets?

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  1. Explain the meaning of gain and profit. Distinguish between these two terms.

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  1. Explain the qualitative characteristics of accounting information.

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  1. Describe the role of accounting in the modern world.

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Checklist to Test Your Understanding

Test Your Understanding – I

(a) Economic Transactions

(b) Management/Employees

(c) Creditor

(d) Time-gap

(e) External

(f) Free from bias

(g) Identifying the transactions and communicating information

(h) Monetary

(i) Chronological

Test Your Understanding – II

  1. Reliability, i.e. Verifiability, Faithfulness, Nutrality
  2. Relevance, i.e. Timeliness
  3. Understandability and Comparibility

Test Your Understanding – III

(a) Government and other regulators

(b) Management

(c) Social responsibility groups

(d) Lenders

(e) Suppliers and Creditors

(f) Customers

Test Your Understanding – IV

  1. (c) 2. (a) 3. (c) 4. (a) 5. (a)

Test Your Understanding – V

  1. ₹ 5,00,000 2. ₹ 1,00,000, 3.₹ 2,00,000
  2. Mr. Reace, ₹ 1,50,000 5. ₹ 5,000 6. ₹ 5,000
  3. ₹ 30,000 8. Mr. Ravi, ₹ 1,00,000 9. ₹ 35,000
  4. Assets : debtors; Liabilities : creditors; drawings; Revenues : sales expenses, discount, salary. Activity 1 : Tick (✔) the appropriate one:
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