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JAIPUR
NATIONAL UNIVERSITY, JAIPUR
School of
Distance Education & Learning
Internal
Assignment No. 1
Bachelor
of Business Administration (BBA)- (Retailing)
Paper code: BBA-101
Paper title: Fundamentals Of Accounting
Last date of submission:
Max.Marks:30
Note : Question No. 1 is of short answer type and is compulsory
for all the students. It carries 1 Mark each (Word limits 50-100)
Question 1. Answer all the questions:
(i)
What do you mean by accounting?
Answer: In simple words, accounting can be
defined as keeping records of all financial transactions related to an
individual or an entity. And then there are pre-defined rules and procedures in
the way a transaction should be accounted for. This is what we call debit or
credit, income or expenditure, asset or liability. There are then rules on
whether it would be an asset or an expenditure and so on.
A proper definition of accounting is that it is
the process of recording, summarizing, analyzing, and reporting the financial
transactions related to a business. It explains how a business organization
records, organizes and reports these transactions to regulators and other
parties. It helps to translate the working of business intangible reports for
Question3.What
do you mean by incomplete records?
Answer: There can be two ways of maintaining the
accounting records, one is the double entry system and another is the single
entry system. The records maintained according to the single entry system are
known as Incomplete Records. Usually, small firms like grocery shops, general
stores, food joints, etc. keep their books on the single entry system. It does not maintain the accounts of expenses,
incomes, assets, and liabilities properly. Hence, as the information provided
by these records is incomplete, they are known as Incomplete Records.
Reasons for Incompleteness
The proprietor may keep the
accounting records on the basis of single entry due to the following reasons:
Question4. What do you mean by forfeited of
share? Explain with example.
Answer: Forfeiture
of shares is referred to as the situation when the allotted shares are
cancelled by the issuing company due to non-payment of the subscription amount
as requested by the issuing company from the shareholder.In the event of
forfeiture of shares, the shareholders loses the rights and interests of being
a shareholder and ceases to be a member of the organisation.
Question5. Explain any one method of
depreciation.
Answer: Double Declining Balance Depreciation Method:-
Compared to other depreciation
methods, double-declining-balance depreciation results in a larger amount
expensed in the earlier years as opposed to the later years of an asset’s
useful life. The method reflects the fact that assets are typically more productive
in their early years than in their later years – also, the practical fact that
Question6.
Define accounting. Give the main objectives of accounting?
Answer: According
to Smith and Ashburne, Accounting is the science of recording and classifying
business transactions and events, primarily of a financial character and the
art of making significant summaries, analysis and interpretations of these
transactions and events and communicating results to persons who must take
decisions or form judgement.”
Question7. What
do you mean by depreciation? Give two reason of decrease in the value of assets?
Answer: Depreciation is an accounting method of allocating the cost of a
tangible or physical asset over its useful life or life expectancy.
Depreciation represents how much of an asset's value has been used up.
Depreciating assets helps companies earn revenue from an asset while expensing
a portion of its cost each year the asset is in use. If not taken into account,
it can greatly affect profits.
Assets depreciate for two main reasons:
Wear and tear. For example, a
car will decrease in value because of the mileage, wear on tyres, and other
factors related to the use of the vehicle.
Question8.What is income
and expenditure account? How is it differentiate for receipt and payment
account?
Answer: . 1)Cash
and non-cash transactions:-
Receipt &
Question9. Write down the different type of shares?
Answer: Preferential
Share Capital:-
The preferential share capital is that part of
the Issued share capital of the company carrying a preferential right for:
Dividend Payment – A fixed amount or amount
calculated at a fixed rate. This might/might not be subject
Question10.
What do you mean by redemption of debenture?
Answer: Redemption of debentures is a process of
repayment of loan taken by issue of debentures. Generally debentures are issued
with the notice that they may be redeemed at the option of the company within a
specified period and at a specified price. The terms of redemption of
debentures are clearly mentioned in the debentures certificate.
Note: Answer any four questions. Each
question carries 5 marks (Word limits 500)
Question1. What do you mean by accounting? Who are the
users of accounting? Explain its scope.
Answer: Accounting is the process of recording
financial transactions pertaining to a business. The accounting process
includes summarizing, analyzing and reporting these transactions to oversight
agencies, regulators and tax collection entities. The financial statements used
in accounting are a concise summary of financial transactions over an
accounting period, summarizing a company's operations, financial position and
cash flows.
Users of Accounting:-
Question
2. Define debenture. Explain the
various types of debentures.
Answer: A debenture is a medium- to long-term debt
instrument used by large companies to borrow money, at a fixed rate of
interest. The legal term "debenture" originally referred to a
document that either creates a debt or acknowledges it, but in some countries
the term is now used interchangeably with bond, loan stock or note. A debenture
is thus like a certificate of loan or a loan bond evidencing the fact that the
company is liable to pay a specified amount with interest. Although the money
raised by the debentures becomes a part of the
Q. 3. Journalise
the following transactions in the books of M/s Sohan & sons:
|
2008 |
|
Rs. |
|
Jan., 01 |
Goods purchase for cash |
1,200 |
|
Jan., 02 |
Purchase good from Ram |
1,500 |
|
Jan., 04 |
Goods sold to Laxman |
1,000 |
|
Jan., 05 |
Furniture purchase for cash |
800 |
|
Jan., 07 |
Charge interest on capital |
2,500 |
|
Jan., 11 |
Goods return from Laxman |
200 |
|
Jan., 12 |
Goods return to Ram |
500 |
|
Jan., 14 |
Withdrew from bank for private use |
6,000 |
|
Jan., 16 |
Give in charity: Cash |
100 |
|
|
Goods |
200 |
|
Jan., 19 |
Salaries paid by cheque |
4,000 |
|
Jan., 21 |
Goods sold to Sachin on 10% trade discount
and 8% Cash discount |
1,000 |
|
Jan., 23 |
Laxman become insolvent and could pay only
75 paise in a rupee |
|
|
Jan., 26 |
Proprietor took goods for his personal use |
2,000 |
|
Jan., 29 |
Postage Rs. 200 and Rent Rs. 1000 Paid |
|
|
Jan., 31 |
Received Rs. 4,000 from insurance
company |
|
|
|
|
|
Answer: JOURNAL ENTRIES
In the books of M/s
Sohan & sons
For the month of
January, 2008:
Jan., 01 Goods
purchase for cash 1,200
To Cash A/C
Question4. What are redeemable [reference shares? Discuss the
different methods of redeeming the redeemable preference shares.
Answer: Redeemable Preferences shares are those type of preference shares
issued to shareholders which have a callable option embedded, meaning they can
be redeemed later by the company. Redeemable preference shares are those preference shares that have
a predetermined redemption clause at the time of their issue. In the case of
these shares, a redemption price/price range is predetermined and noted in the
issue prospectus. The issuing company has a right to redeem i.e., buy back
these shares at the predetermined redemption price at any time before the redemption
period specified.
Dear
students, get latest JNU MBA Solved assignments by professionals.
Mail
us at: help.mbaassignments@gmail.com
Call
us at: 08263069601
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