The difference between book keeping and accounting is that while
Book keeping interprets data, accounting records it
Book keeping is regarded as the language of the business accounting ascertians its strength and weakness
Book keeping records data accounting interprets it
Book keeping summaries information accounting communicates it
Correct answer is C
In the simplest of terms, bookkeeping is responsible for the recording of financial transactions whereas accounting is responsible for interpreting, classifying, analyzing, reporting, and summarizing the financial data.
Which of the following expenses relate to the profit and loss account of a manufacturing firm?
Administrative overhead
Direct labour
Direct materials
Work-in-progress
Correct answer is A
Administrative overhead is those costs not involved in the development or production of goods or services. This is essentially all overhead that is not included in manufacturing overhead. Examples of administrative overhead costs are the costs of: Front office and sales salaries, wages, and commissions. Office supplies.
A business organization prepares departmental account in order to
Ascertain the contribution of each department to the organization
Ascertain interdepartmental transfer
Build other branches
Know the number of departments in the organization
Correct answer is A
The main objectives of departmental accounting are: To check out an interdepartmental performance. To evaluate the performance of the department with the previous period result. The gross profit of each department can be ascertained.
When the purchase consideration is lower ttan the net asset, the buyer has gained the advantage of
Capital reserve
Revenue reserve
Net income
Net loss
Correct answer is A
Capital Reserve is a type of profit that is earned on capital transactions - an example would be the profit arising from the forfeiture of shares, sales of assets etc
Which of the following is accounted for in receipts and payments account?
Accrued expenses on annual dances
Subscriptions due but not yet received
Interest on bank deposit
Depreciation of the club house
Correct answer is C
"A receipt and payment account is a summarized cash book (cash and bank) for a given period"
The bank column would reflect interest on bank deposits