NCERT Solutions Class 11 Accountancy Chapter 7, are available on Vedantu, in a PDF format, and you can download them for free. These solutions save your time and effort in looking for answers in different books and websites. Vedantu being the one-stop solution to all your NCERT problems makes an effort for the students to make learning a better and hassle-free experience. The Ch 7 Accounts Class 11 NCERT Solutions provide a detailed explanation of the topics covered in this chapter. Hence, when you go through these solutions, you will be able to understand the concepts easily.
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NCERT Accountancy Class 11 Solutions
Introduction to Accounting
In very simple terms you can understand accounting to be a process in which we record the financial transactions of a business systematically. This process requires the understanding of mainly three aspects. They are as follows.
Record Keeping System: To keep a track record of all the transactions that have taken place one needs to be aware of certain policies, procedures, and standardized forms.
Transaction Tracking: While recording transactions it is also important to know about the types of transactions such as customer orders, payments made, etc.
Financial Reporting: Some of the financial transactions need to be treated differently than others and recorded accordingly. Financial reporting involves the tracking of expenses, revenues, profits, capital invested, etc. and gaining a deep insight into them.
The Layers of Accounting
In Class 11 Accounts Chapter 7 NCERT Solutions, you will come across questions on the different layers of accounting as an overview of the chapter.
Accounting has different parts, layers, or types. Every organization is independent to decide these layers on its own but some of the layers which are common everywhere are mentioned below.
Taxes: It is pretty obvious that since it is a business, taxes play an important role and every business organization has to be completely transparent about it. Thus, accounting involves keeping a record of taxes paid, pending, etc.
Payroll: Payrolls deal with not just paying the employees that are currently working but also other employee-related payments such as social security, workman's comp, etc.
Payable and Receivable Accounts: A business runs smoothly when funds run smoothly. So, the accountant has to keep a track record of money that has been spent at a particular place and money that is received after-sales.
Bookkeeping: If the accountant ignores certain small-sized transactions after a time those gather into big numbers and ruin the complete accounting. Hence, every small and every big transaction has to be recorded.
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The End Result of Accounting
Once the transactions are recorded and stored it is time that you analyze the result. But, how? Does one have to go through all the spreadsheets and the smallest transactions? Well, no.
Records are generated in case the investor or owner of the business wants to analyze the performance of his business. The main kinds of reports generated are as follows.
Statement of Profit and Loss
Assets and Liabilities Report
A Brief Introduction to Depreciation
In NCERT Accountancy Book Class 11 Solutions Chapter 7, one term that you will come across is 'Depreciation'. Let us discuss it briefly. To begin with, depreciation in accounting refers to the cost that has been allocated to a particular asset in a given period. It gives an idea about how much of the value of an asset has been used up or exhausted in the previous years. Depreciation can greatly contribute to a company's profits if calculated in the right way.
This short overview and the NCERT Solutions Class 11 Accountancy Chapter 7 PDF will help you to learn more about the topic and understand depreciation Class 11 CBSE Solutions thoroughly.
While these were just some of the introductory topics in ch 7 Accounts Class 11, you can get the fully solved and well-explained solutions of all NCERT problems given in chapter 7.
Some of the very interesting and exciting fun facts related to accounting are as follows.
World Accounting Day is celebrated on November 10.
The very popular bubblegum was invented by an accountant named Walter Diemer in the year 1928.
Bookkeeping and the words that can be derived from it are the only words in the English language that have three consecutive sets of repeating letters.
Q1. Which of These Is Not an Example of Revenue?
Ans: 3. Taxes
FAQs (Frequently Asked Questions)
Q1. What are the objectives of accounting?
Ans: Accounting is a study that allows a business organization to maintain and track books of accounts efficiently. The objectives of accounting are listed below.
To calculate the cost of production of a particular item.
To find out net profit or net loss a business organization has gone through in a particular period.
To detect fraud or missing money.
To keep a record of expenses and income in a particular period.
To find out the Cash Balance of a particular day.
To find the position of assets and liabilities on a particular day.
To help the management department in formulating policies that will benefit the organization.
Q2. What do you mean by asset and what are the different types of assets?
Ans: In order to function in a competitive market, a business organization must possess assets that add value to the specific business objective. An asset in accounting is any resource with an economic value which is owned by a particular individual or any organization collectively with the hope of extracting greater benefits in the future.
The characteristics of an asset are as follows.
An asset is both owned and controlled by only the owner.
An asset may or may not become a source of finance in the future.
The types of assets are Current assets, Non-Current assets, Tangible assets, Intangible assets, Operating assets, Non-operating and Fictitious assets.
Q3. What are the topics in Chapter 7 Class 11 Accountancy?
Ans: The three main topics in Chapter 7 of Class 11 Accounts are Depreciation, Provisions and Reserves. All three topics are very important for the students of Class 11 Accounting. These topics can be said to be the foundation. Once you analyse the facts of these topics, it will be very easy for you to understand the proper concept.
Q4. How can I prepare well for this Chapter?
Ans: Reading and understanding each topic of Chapter 7 of Class 11 Accounts is very important. Sometimes, it happens that when you read the chapter for the first time, you might not understand much. This will make you feel that maybe the chapter is difficult. But in actuality, it is not. Just take a break and come back and read again, and you will understand a little more. Read it for the third time. You can make out the difference. As you begin to understand, you will feel happy and gain interest to read more.
Q5. What are important topics to focus on for Class 11 Accounts?
Ans: All the topics in Class 11 Accounts are very important, but mainly, you can focus on Depreciation, Features Of Depreciation, Compliance With The Law, Causes Of Depreciation, Residual Revenue, Depreciable Cost, Factors That Affect Depreciation On. The content related to this is available on the Vedantu website for free and also on the Vedantu Mobile app.
Q6. What are the Features Of Depreciation?
Ans: The Features Of Depreciation are:
The depreciation is declined in the book value of the fixed assets.
It does not involve any cash flow.
It is a loss of value.
It is considered an expired cost and should be deducted before the taxable profit.
Q7. What is the annual charge of depreciation?
Ans: In Chapter 7 of Class 11 Accounts, the annual amount of depreciation that is charged every year remains unchanged. The annual amount of depreciation is higher in the first year and gets reduced in the later years. This is because it is calculated in both ways and is the straight-line method, which is calculated on the original cost, whereas the written down value is calculated on the written down value.