DK Goel Solutions Class 11 Accountancy Chapter 4

Commerce

DK Goel Solutions Class 11 Accountancy Chapter 4

Last updated date: 24th Apr 2024

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Easy to Understand Solutions of Chapter 4

The DK Goel Class 11 Accountancy Chapter 4 - Process and Bases of Accounting solutions are given here by subject experts so that students can grasp the subject matter and fetch good marks. The solutions are presented in a very easy-to-learn manner for the proper understanding of concepts. After studying this chapter you would get to learn about the different processes and bases of accounting. You would also get to learn which basis of accounting is suitable for individuals and companies. These solutions make a comprehensive and great study resource for your examination preparation.

For students in Class 11, DK Goel Solutions is largely recognized as the most effective study resource. These Class 11 solutions are based on the most recent CBSE syllabus, ensuring that you will pass your board exams. DK Goel Solutions for Class 11 helps students learn and understand accounting fundamentals, allowing them to answer complex questions with ease.

DK Goel Solutions Class 11 Accounts can be found in this section. Students looking for DK Goel accounting solutions for class 11 can find them here. DK Goel Class 11 solutions are organized by chapter so that students may rapidly grasp the concepts required to solve the problems. Students can acquire basic concepts and strategies for solving accounting issues by using DK Goel responses.

Before You Begin Reading This PDF, You Should Be Familiar With the Following Terms:

Accounting: Accounting is the process of reporting, documenting, assessing, and summarising financial information. Accounting provides decision-makers with information about an organization's financial health, allowing them to make better decisions. Accounting is used by almost everyone nowadays, and having a solid understanding of it is beneficial to everyone. Accounting can be thought of as a language for dealing with money.
Process of accounting: A company's accounting process begins with the identification of its transactions, followed by the recording, categorizing, and summarising of those transactions, which aids in the preparation of the trial balance and financial statement.
Source documents of accountancy: The source document is the first document in a commercial transaction that is recorded. This document contains all of the pertinent information, such as the date, the amount, the names of the persons involved, and the account's nature. All entries in other books are recorded exclusively from the source document
Cash discount: The term "cash discount" refers to a discount given to a consumer in exchange for fast payment. It's always kept track of in the accounting books.
Expense and Expenditure: The cost of making and selling goods and services is referred to as an expense. As a result, it comprises the cost of goods sold as well as wages, rent, commissions, and other expenses. Expenditure, on the other hand, is a broader phrase that encompasses both income and expense. The cost of assets, goods, and services is referred to as expenditure.

Read Chapter 4 Process and Accounting Bases DK Goel Solutions for Class 11. The content in the PDF is created using the most recent DK Goel Accountancy book published this academic year. The book is quite helpful since it covers the Process of Accounting, Cash Basis of Accounting, and Accrual Basis of Accounting in great depth to students in Class 11 Commerce Accountancy. It has well-crafted questions that aid in the understanding of ideas for students in Class 11 Accounting.

FAQs on DK Goel Solutions Class 11 Accountancy Chapter 4

1. What is Cash basis in accounting?

A key accounting approach that recognizes revenues and expenses when cash is received or paid out is referred to as a cash basis. When cash is received or paid, cash basis entries are recorded in the book of accounts, not when the receipt or payment is due. Expenses are recorded as incurred after they have been paid.

The difference between net revenue and total expenditure for the financial year represents the profit or loss of a corporation. As a result, the Cash Basis of Accounting excludes outstanding and prepaid costs, as well as revenue collected in advance or accrued profits.

2. What is the meaning of the accrual basis of accounting?

The accrual basis is a technique of accounting that records revenue and expenses as they are earned and incurred. Allowances for sales returns, bad debts, and inventory obsolescence must be made on an accrual basis, which must be made in advance of the occurrence of such events.

Revenues and costs are recorded in the period in which they occur rather than when they are paid in accrual basis accounting. Financial revenue is recorded as income on the accrual system, as it is received or accumulates. If an expense has been incurred but payment has not been made, it would also be listed as an expense.

3. What are the advantages of the accrual basis of accounting?

There are various advantages to accrual accounting, most of which are related to accurate income and expense reporting: It gives a clear picture of the company's overall cash flow. Accrual accounting represents the fact that income and costs incurred in one month can be carried forward to the following month or even longer.

Most accountants prefer the accrual accounting foundation over the cash accounting basis because it is more scientific.
The financial basis is widely accepted since it shows the true advantage or loss throughout the accounting period.

4. What is the Accounting Process?

Accounting is the procedure for keeping track of a company's financial activities. These transactions are summarised, analyzed, and reported to oversight authorities, regulators, and tax collection entities as part of the accounting process.

The accounting Process encapsulates the entire accounting process of a business. It encompasses the full range of financial activities, as well as the tracking, documenting, categorizing, and summarising of those transactions in order to create financial reports for the company. This enables businesses to better prepare financial statements and deal with losses or unexpected expenses.

5. Does the cash basis of accounting violate GAAP?

Because it does not follow accounting standards and the accrual basis of accounting, the cash basis of accounting violates GAAP.

Accrual accounting mandates that businesses report sales at the time they occur. The timing of actual payments is not as essential as it is with the cash basis technique. The accrual method records revenue at the point of sale when a corporation sells an item to a consumer on a credit account where payment is delayed for a short duration (less than a year) or a long term (more than a year).